BILL ANALYSIS

Senate Research Center	H.B. 3339
86R19628 BRG-F	By: Dominguez (Creighton)
	Water & Rural Affairs
	5/11/2019
	Engrossed

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

H.B. 3339 enacts statutory changes so that there is a single, consistent requirement for water conservation plans for all applicants for financial assistance at the Texas Water Development Board (TWDB). The requirement that each applicant adopt or implement a water conservation plan is located in various sections of statutes applicable to each TWDB financial assistance program, and these requirements are not all consistent with one another. To ensure consistency and clarity, H.B. 3339 will locate this statutory requirement in one section that is applicable to all relevant TWDB financial assistance programs. One consistent water conservation plan requirement for all programs would eliminate discrepancies and apply the requirement to both surface water and groundwater projects for all programs.

H.B. 3339 amends current law relating to requirements for programs of water conservation and water conservation plans.

Note: While the statutory reference in this bill is to the Texas Natural Resource Conservation Commission (TNRCC), the following amendments affect the Texas Commission on Environmental Quality, as the successor agency to TNRCC.

RULEMAKING AUTHORITY

This bill does not expressly grant any additional rulemaking authority to a state officer, institution, or agency.

SECTION BY SECTION ANALYSIS

SECTION 1. Amends Sections 15.103(a) and (e), Water Code, as follows:

(a) Requires the applicant, in an application to the Texas Water Development Board (TWDB) for financial assistance from the water loan assistance fund (loan fund), to include:

(1)�(4) makes no changes to these subdivisions;

(5) makes a nonsubstantive change to this subdivision;

(6) the water conservation plan required by Section 16.4021; and

(7)� creates this subdivision from existing text and makes no further changes.

(e) Requires the applicant, if the applicant claims an exemption under Section 16.4021(d), rather than if the applicant claims an exemption under Subsection (c), Section 15.106 of this code, to state the exemption in the application and provide information relating to the exemption as required by TWDB rules. Makes nonsubstantive changes.

SECTION 2. Amends Section 15.206(b), Water Code, as follows:

(b) Requires the application by an issuer to TWDB for insurance of the issuer's bonds to include the following information:

(1)�(5) makes no changes to these subdivisions;

(6) makes a nonsubstantive change to this subdivision;

(7) the water conservation plan required by Section 16.4021; and

(8) creates this subdivision from existing text and makes no further changes.

SECTION 3. Amends Section 15.435(g), Water Code, as follows:

(g) Prohibits TWDB from directing the trust company to enter into a bond enhancement agreement with respect to bonds issued by TWDB the proceeds of which are authorized to be used to provide financial assistance to an applicant if at the time of the request the applicant has failed to:

(1) provide information regarding a water conservation plan in accordance with Section 16.4021, rather than submit or implement a water conservation plan in accordance with Section 11.1271; or

(2) makes no changes to this subdivision.

SECTION 4. Amends Section 15.607, Water Code, as follows:

Sec. 15.607. APPROVAL OF APPLICATION. Authorizes TWDB by resolution, on review of recommendations by the executive administrator of TWDB (executive administrator), to approve an application if TWDB finds that in its opinion the revenue or taxes or both revenue and taxes pledged by the applicant will be sufficient to meet all the obligations assumed by the applicant and that the application and assistance applied for meet the requirements of the federal act and state law, including Section 16.4021, rather than the requirements of the federal act and state law. Deletes existing text requiring a program of water conservation for the more effective use of water to be required in the same manner as required for approval of an application for financial assistance under Section 15.106 of this code.

SECTION 5. Amends Section 15.910(a), Water Code, as follows:

(a) Requires a political subdivision or water supply corporation, in an application to TWDB for financial assistance from the disadvantaged rural community water and wastewater financial assistance fund, to include:

(1)�(5) makes no changes to these subdivisions;

(6) makes a nonsubstantive change to this subdivision;

(7) the water conservation plan required by Section 16.4021; and

(8) creates this subdivision from existing text and makes no further changes.

SECTION 6. Amends Section 15.975(a), Water Code, as follows:

(a) Authorizes TWDB by resolution, on review and recommendation by the executive administrator, to approve an application for certain uses of the water infrastructure fund if TWDB finds that:

(1) the application and the assistance applied for meet the requirements of this subchapter (Water Infrastructure Fund), Section 16.4021, and board rules; and

(2)�(3) makes no changes to these subdivisions.

SECTION 7. Amends Section 15.995(e), Water Code, to require an application from a rural political subdivision for financial assistance under this subchapter to comply with the requirements of Section 16.4021, rather than requiring a program of water conservation for the more efficient use of water to be required in the same manner as is required for approval of an application for financial assistance under Section 15.106 (Approval of Application).

SECTION 8. Amends Section 16.136, Water Code, as follows:

Sec. 16.136. FACILITIES WANTED BY POLITICAL SUBDIVISION. Authorizes TWDB to acquire all or part of any authorized facility to the extent that TWD finds that the political subdivision:

(1)�(3) makes no changes to these subdivisions; and

(4) has complied with water conservation plan requirements as required by Section 16.4021, rather than has a program of water conservation for the more efficient use of water as required by Section 15.106 of this code.

SECTION 9. Amends Section 16.402(c), Water Code, to require the executive administrator to review each water conservation plan and annual report to determine compliance with the minimum requirements established by Section 16.4021, rather than Section 11.1271, and the submission deadlines developed under Subsection (e) of this section.

SECTION 10. Amends Subchapter K, Chapter 16, Water Code, by adding Section 16.4021, as follows:

Sec. 16.4021. WATER CONSERVATION PLAN REQUIREMENTS. (a) Defines "water conservation plan" for purposes of this section.

(b) Provides that this section applies to an application for financial assistance under:

(1) Subchapters C (Water Loan Assistance Program), D (Water Bond Insurance Program), E (Storage Acquisition Program), G (State Water Implementation Fund For Texas), H (State Water Implementation Revenue Fund For Texas), J (Financial Assistance For Water Pollution Control), O (Program For Water and Wastewater Financial Assistance For Disadvantaged Rural Communities), Q, and R (Rural Water Assistance Fund), Chapter 15;

(2) Subchapters E (Acquisition and Development of Facilities) and F (Sale or Lease of Facilities) of this chapter; and

(3) Subchapters D (Assistance to Political Subdivisions For Water Supply Projects), F (Financial Assistance For Water Quality Enhancement Purposes), I (Revenue Bond Program), K (Assistance to Economically Distressed Areas For Water Supply and Sewer Service Projects), and L (Water Financial Assistance Bond Program), Chapter 17.

(c) Requires an applicant, except as provided by Subsection (d), to submit with the application a description of the applicant's proposed or adopted water conservation plan. Provides that the water conservation plan:

(1) is required to:

(A) incorporate the practices, techniques, and technology described by Section 15.001(9)(B) (relating to the definition of "conservation");

(B) meet reasonably anticipated local needs and conditions, as determined by TWDB; and

(C) include specific, quantified five-year and 10-year targets for water savings, including goals for water loss programs and municipal use measured in gallons per capita per day; and

(2) is authorized to include:

(A) restrictions on discretionary water uses, including lawn watering;

(B) plumbing code standards for water conservation in new building construction;

(D) educational programs;

(E) universal metering;

(F) conservation-oriented water rate structures;

(G) drought contingency plans; and

(H) distribution system leak detection and repair.

(d) Provides that an applicant is not required to submit a water conservation plan under this section if:

(1) an emergency exists as determined by TWDB;

(2) the amount of financial assistance under consideration is not greater than $500,000;

(3) the applicant demonstrates and TWDB finds that the implementation of a water conservation plan is not reasonably necessary for conservation; or

(4) the financial assistance is to fund a project that consists of construction outside this state.

(e) Prohibits TWDB from providing financial assistance to an applicant to which this section applies unless the applicant demonstrates that it has adopted and implemented a water conservation plan that meets the requirements for a water conservation plan under Subsection (c).

(f) Requires TWDB to establish an educational and technical assistance program to assist political subdivisions in developing comprehensive water conservation plans.

(g) Provides that, if the applicant will use the project to furnish water or services to another entity that will furnish the water or services to the ultimate consumer, the requirement for an applicant to demonstrate adoption and implementation of a water conservation plan can be met through contractual agreements between the applicant and the other entity providing for the adoption and implementation of a water conservation plan by the other entity.

(h) Requires rules adopted under this section to state the criteria for preparation, review, and enforcement of an applicant's water conservation plan.

SECTION 11. Amends Section 16.403, Water Code, as added by Chapter 595 (S.B. 181), Acts of the 82nd Legislature, Regular Session, 2011, as follows:

Sec. 16.403. WATER USE REPORTING. (a) Deletes existing Subdivisions (a)(1)�(6). Deletes Subsection (b) and redesignates existing Subsections (c)-(e) as Subsections (b)‑(d). Deletes existing text providing certain findings of the legislature regarding water usage. Requires TWDB and the Texas Natural Resource Conservation Commission (TNRCC), in consultation with the Water Conservation Advisory Council, to develop a uniform, consistent methodology and guidance for calculating water use and conservation to be used by a municipality or water utility in developing water conservation plans and preparing reports required under this code. Requires the methodology and guidance, at a minimum, to include certain methods and guidelines to calculate water use by water users.

(b) Deletes existing Subdivisions (3)�(7) and (9)�(11) relating to certain provisions governing submissions to TWDB or TNRCC. Requires TWDB or TNRCC, as appropriate, to use the methodology and guidance developed under Subsection (a), rather than Subsection (b), in evaluating a water conservation plan, program of water conservation, survey, or other report relating to water conservation submitted to TWDB or TNRCC under:

(1) Section 11.1271;

(2) Section 13.146;

(3) Section 16.012(m);

(4) redesignates existing Subdivision (8) as Subdivision (4) and makes a nonsubstantive change; or

(5) Section 16.4021.

(d) Makes a conforming change to this subsection.

(e) Requires data included in a water conservation plan or report required under this code and submitted to TWDB or TNRCC to be interpreted in the context of variations in local water use. Prohibits the data from being the only factor considered by TNRCC in determining the highest practicable level of water conservation and efficiency achievable in the jurisdiction of a municipality or water utility for purposes of Section 11.085(l) (relating to authorizing TNRCC to grant, in whole or in part, an application for an interbasin transfer only to the extent that it meets certain conditions) .

SECTION 12. Amends Sections 17.122(a) and (c), Water Code, as follows:

(a) Requires the applicant, in an application to TWDB for financial assistance for a water supply project, to include:

(1)�(6) makes no changes to these subdivisions;

(7) makes a nonsubstantive change to this subdivision;

(8) the water conservation plan required by Section 16.4021; and

(9)� creates this subdivision from existing text and makes no further changes.

(c) Requires the applicant, if the applicant claims an exemption under Section 16.4021, rather than under Subsection (c), Section 17.277, of this code, to state the exemption in the application and provide information relating to that exemption as provided by TWDB rules. Makes nonsubstantive changes.

SECTION 13. Amends Sections 17.274(a) and (c), Water Code, as follow:

(a) Makes a conforming change to this subsection.

(c) Requires the applicant, if the applicant claims an exemption under Section 16.4021, rather than under Subsection (d), Section 17.277, of this code, to state the exemption in the application and provide information relating to that exemption as provided by TWDB rules.

SECTION 14. Amends Section 17.855(a), Water Code, to make a conforming change.

SECTION 15. Amends Section 17.927(b), Water Code, as follows:

(b) Requires the application for financial assistance under this subchapter and plan to include:

(1)�(6) makes no changes to these subdivisions;

(7)�(8) makes nonsubstantive changes to these subdivisions; and

(9) the water conservation plan required by Section 16.4021.

SECTION 16. Repealer: Section 15.103(d) (relating to requiring an applicant, if an applicant has a certain program of water conservation, to state in his application that he has such a program), Water Code.

Repealer: Section 15.106(b) (relating to requiring TWDB, before TWDB grants a certain application, to require an applicant to adopt a certain program of water conservation), Water Code.

Repealer: Section 15.106(b-1) (relating to requiring all water conservation plans required under this section, beginning May 1, 2005, to include specific, quantified 5-year and 10‑year targets for water savings), Water Code.

Repealer: Section 15.106(c) (relating to prohibiting TWDB from requiring a certain program of water conservation to be adopted under certain conditions), Water Code.

Repealer: Section 15.106(d) (relating to requiring TWDB, to the extent funds are available, to establish a certain educational and technical assistance program), Water Code.

Repealer: Section 15.106(e) (relating to providing that if the political subdivision will utilize the project to furnish water or services to another political subdivision that in turn will furnish the water or services to the ultimate consumer, the requirements of TWDB relative to water conservation can be met through contractual agreements between the political subdivisions providing for establishment of a water conservation plan and other necessary measures), Water Code.

Repealer: Section 15.106(f) (relating to requiring rules adopted under this section to state the criteria for preparation, review, and enforcement of an applicant's conservation program), Water Code.

Repealer: Section 15.208(b) (relating to authorizing TWDB, if TWDB finds that an applicant is not using water efficiently, to require the applicant to develop a conservation program to provide for more efficient use of water), Water Code.

Repealer: Section 15.208(c) (relating to authorizing TWDB to establish an educational and technical assistance program to assist political subdivisions in developing comprehensive water conservation programs required by this section and other sections of this code), Water Code.

Repealer: Section 15.208(d) (relating to providing that if the issuer plans to utilize the project to furnish water or services to a political subdivision that in turn plans to furnish the water or services to the ultimate consumer, the requirements of TWDB relative to water conservation can be met through contractual agreements between the issuer and the political subdivision providing for establishment of a water conservation program and other necessary measures), Water Code.

Repealer: Section 15.910(c) (relating to requiring the subdivision or corporation, if a political subdivision or water supply corporation has a program of water conservation, to state in the application that the subdivision or corporation has such a program), Water Code.

Repealer: Section 15.975(b) (relating to requiring a program of water conservation through a more effective use of water, for an application under this subchapter, to be required in the a certain manner as for approval), Water Code.

Repealer: Section 16.403 (Water Use Reporting), as added by Chapter 1233 (S.B. 660), Acts of the 82nd Legislature, Regular Session, 2011;

Repealer: Section 17.125(b) (relating to requiring TWDB, before TWDB grants the application or provides any funds under an application, to require an applicant to adopt a certain program of water conservation for the more efficient use of water), Water Code.

Repealer: Section 17.125(b-1) (relating to requiring all water conservation plans required under this section, beginning May 1, 2005, to include specific, quantified 5-year and 10‑year targets for water savings and requiring the entity preparing the plan to establish the targets.), Water Code.

Repealer: Section 17.125(b-2) (relating to requiring TWDB to give priority to applications for funds for implementation of water supply projects in the state water plan by certain entities), Water Code.

Repealer: Section 17.125(c) (relating to prohibiting TWDB from requiring a certain program of water conservation to be adopted under certain conditions), Water Code.

Repealer: Section 17.125(d) (relating to requiring TWDB, to the extent funds are available, to establish a certain educational and technical assistance program), Water Code.

Repealer: Section 17.125(e) (relating to providing that if the political subdivision will utilize the water supply project to furnish water or services to another political subdivision that in turn will furnish the water or services to the ultimate consumer, the requirements of TWDB relative to water conservation can be met through contractual agreements between the political subdivisions providing for establishment of a water conservation plan and other measures), Water Code.

Repealer: Section 17.125(f) (relating to requiring rules adopted under this section to state the criteria for preparation, review, and enforcement of an applicant's conservation program), Water Code.

Repealer: Section 17.274(b) (relating to requiring the applicant, if the applicant has a certain program of water conservation, to state in the application that it has a water conservation program), Water Code.

Repealer: Section 17.277(b) (relating to requiring TWDB, before TWDB grants the application or provides any funds under an application, to require an applicant to adopt a certain program of water conservation for the more efficient use of water), Water Code.

Repealer: Section 17.277(b-1) (relating to requiring all water conservation plans required under this section, beginning May 1, 2005, to include specific, quantified 5-year and 10‑year targets for water savings), Water Code.

Repealer: Section 17.277(c) (relating to prohibiting TWDB from requiring a certain program of water conservation to be adopted under certain conditions), Water Code.

Repealer: Section 17.277(d) (relating to requiring TWDB, to the extent funds are available, to establish an educational and technical assistance program to assist political subdivisions in developing comprehensive water conservation plans required by this section and other sections of this code), Water Code.

Repealer: Section 17.277(e) (relating to providing that, if the political subdivision will utilize the project to furnish water or services to another political subdivision that in turn will furnish the water or services to the ultimate consumer, the requirements of TWDB relative to water conservation can be met through contractual agreements between the political subdivisions providing for establishment of a water conservation plan and other measures), Water Code.

Repealer: Section 17.277(f) (relating to requiring rules adopted under this section to state the criteria for preparation, review, and enforcement of an applicant's conservation program), Water Code.

Repealer Section 17.857(b) (relating to requiring TWDB, before TWDB grants the application or provides any funds under an application, to require an applicant to adopt a program of water conservation for the more efficient use of water), Water Code.

Repealer Section 17.857(b-1) (relating to requiring all water conservation plans required under this section, beginning May 1, 2005, to include specific, quantified 5-year and 10‑year targets for water savings), Water Code.

Repealer Section 17.857(c) (relating to prohibit TWDB from requiring a certain program of water conservation to be adopted under certain conditions), Water Code.

Repealer Section 17.857(d) (relating to providing that, if the political subdivision will utilize the project to furnish water or services to another political subdivision that in turn will furnish the water or services to the ultimate consumer, the requirements of TWDB relative to water conservation can be met through contractual agreements between the political subdivisions providing for establishment of a water conservation plan and other measures), Water Code.

Repealer: Section 17.927(c) (relating to requiring TWDB, before the board approves the application or provides any funds under an application, to require an applicant to adopt a certain program of water conservation for the more effective use of water), Water Code.

SECTION 17. Makes application of this Act prospective.

SECTION 18. Effective date: September 1, 2019.