86R4517 SLB-F
 
  By: Taylor S.B. No. 1043
 
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the territory, powers, and administration of the Gulf
  Coast Water Authority.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Sections 2 and 3, Chapter 712, Acts of the 59th
  Legislature, Regular Session, 1965, are amended to read as follows:
         Sec. 2.  The District's territory is [District shall be
  comprised of all of the territory contained within Galveston
  County, Texas, and its boundaries shall be the same as and]
  coextensive with the boundaries of Brazoria, Fort Bend, and
  Galveston Counties [County, Texas].
         Sec. 3.  Except as expressly limited by this Act, the
  District shall have and exercise and is hereby vested with all
  rights, powers, privileges, and authority conferred by the General
  Laws of this State now in force or hereafter enacted applicable to
  municipal utility districts created under authority of Section 59
  of Article XVI, Constitution of Texas including without limitation
  those conferred by Chapters 49 and [Chapter] 54, Water Code, as
  amended, but to the extent that the provisions of such General Laws
  may be in conflict or inconsistent with the provisions of this Act,
  the provisions of this Act shall prevail. All such General Laws are
  hereby adopted and incorporated by reference with the same effect
  as if incorporated in full in this Act. Without in any way limiting
  the generalization of the foregoing, it is expressly provided that
  the District shall have, and is hereby authorized to exercise, the
  following rights, powers, privileges and functions:
         (a)  the power to make, construct, or otherwise acquire
  improvements either within or without the boundaries thereof
  necessary to carry out the powers and authority granted by this Act
  and said General Laws and to exercise the power of eminent domain
  for such purposes; provided, however, that the District shall not
  have the power of eminent domain as to all or any part of the water
  supply, property, works or facilities of any private person or
  persons, or of any private or public corporation or association
  engaged in the business of supplying water in Brazoria County, Fort
  Bend County, or Galveston County, Texas, to any class of consumers
  for any use upon the effective date of this Act, but this provision
  shall not restrict the power of the District to acquire necessary
  crossing easements and rights-of-way;
         (b)  to conserve, store, transport, treat and purify,
  distribute, sell and deliver water, both surface and underground,
  to persons, corporations, both public and private, political
  subdivisions of the State and others, and to purchase, construct or
  lease all property, works and facilities, both within and without
  the District, necessary or useful for such purposes;
         (c)  to acquire water supplies from sources both within or
  without the boundaries of the District and to sell, transport and
  deliver water to customers situated within or without the District
  and to acquire all properties and facilities necessary or useful
  for such purposes, and for any or all of such purposes to enter into
  contracts with persons, corporations, both public and private, and
  political subdivisions of the State for such periods of time and on
  such terms and conditions as the Board of Directors may deem
  desirable;
         (d)  subject to the provisions of this Act, to sell, lease,
  or exchange any property of any kind, or any interest therein, which
  is not necessary to the carrying on of the business of the District
  or the sale, lease, or exchange of which, in the judgment of the
  Board of Directors, is necessary for the exercise of the powers,
  rights, privileges, and functions conferred upon the District by
  this Act or by Chapters 49 and [Chapter] 54, Water Code, as amended;
         (e)  subject to the provisions of this Act, to acquire by
  purchase, lease, gift, or otherwise, and to maintain, use, and
  operate any and all property of any kind, or any interest therein,
  within or without the boundaries of the District, necessary to the
  exercise of the powers, rights, privileges, and functions conferred
  by this Act or by Chapters 49 and [Chapter] 54, Water Code, as
  amended;
         (f)  to construct, extend, improve, maintain, and
  reconstruct, to cause to be constructed, extended, improved,
  maintained, and reconstructed, and to use and operate, any and all
  facilities of any kind necessary to the exercise of such powers,
  rights, privileges, and functions;
         (g)  to sue and be sued in its corporate name;
         (h)  to adopt, use, and alter a corporate seal;
         (i)  to invest and reinvest its funds;
         (j)  to make bylaws for management and regulation of its
  affairs;
         (k)  to appoint officers, agents, and employees, to
  prescribe their duties and fix their compensation;
         (l)  to make contracts and to execute instruments convenient
  or necessary to the exercise of the powers, rights, privileges, and
  functions conferred by this Act or Chapters 49 and [Chapter] 54,
  Water Code, as amended, for such term and with such provisions as
  the Board of Directors may determine to be in the best interests of
  the District, including, without in any way limiting the generality
  of the foregoing, contracts with persons including the State of
  Texas, the United States of America and any corporation or agency
  thereof and districts, cities, towns, persons, organizations,
  firms, corporations or other entities as the Board of Directors may
  deem necessary or proper for or in connection with any of its
  corporate purposes;
         (m)  to borrow money for its corporate purposes and, without
  limiting the generality of the foregoing, to borrow money, apply
  for and receive loans, and accept grants or contributions, directly
  or indirectly, from persons, including the State of Texas, the
  United States of America, or from any corporation, agency, or
  entity created or designated by the State of Texas or the United
  States of America, and in connection with any such loan, [or] grant,
  or contribution, to enter into such agreements as the State of
  Texas, the United States of America, or any such corporation,
  agency, or entity may require; and to make and issue its negotiable
  bonds or notes for money borrowed, in the manner and to the extent
  provided in this Act, and to refund or refinance any outstanding
  bonds, [or] notes, or loans, and to make and issue its negotiable
  bonds or notes therefor in the manner provided in this Act.
         SECTION 2.  Chapter 712, Acts of the 59th Legislature,
  Regular Session, 1965, is amended by adding Sections 3B and 3C to
  read as follows:
         Sec. 3B.  (a) In this section, "person" includes an
  individual, entity, partnership, and corporation. The term does
  not include a political subdivision or public agency.
         (b)  Competitive bidding and contract procurement or
  delivery requirements otherwise applicable to the District do not
  apply to a contract or agreement made by the District with a person
  if:
               (1)  the contract or agreement relates to a project for
  the acquisition or construction of equipment or facilities for the
  production, treatment, transmission, or delivery of water; and
               (2)  payments made under the contract or agreement are
  for amounts substantially sufficient to finance a project described
  in Subdivision (1).
         Sec. 3C.  (a) The Board by resolution may authorize the
  creation of a nonprofit corporation to assist and act for the
  district in implementing a project or providing a service
  authorized by this chapter.
         (b)  The nonprofit corporation:
               (1)  has each power of and is considered to be a local
  government corporation created under Subchapter D, Chapter 431,
  Transportation Code; and
               (2)  may implement any project and provide any service
  authorized by this chapter.
         (c)  The Board shall appoint the board of directors of the
  nonprofit corporation. The board of directors of the nonprofit
  corporation shall serve at the will of the district and in the same
  manner as the board of directors of a local government corporation
  created under Subchapter D, Chapter 431, Transportation Code.
         (d)  The nonprofit corporation may not:
               (1)  exercise the powers of a municipality or county;
               (2)  participate in a project that the District is not
  authorized to participate in;
               (3)  impose taxes; or
               (4)  acquire, construct, or operate parks or
  recreational facilities.
         SECTION 3.  Sections 4(a), (c), and (f), Chapter 712, Acts of
  the 59th Legislature, Regular Session, 1965, are amended to read as
  follows:
         (a)  The District shall have no power or authority to levy
  and collect taxes on any property real, personal or mixed, within
  the boundaries of said District, nor shall the District have power
  or authority to issue bonds or create indebtedness which would in
  any way be payable from ad valorem taxes levied by the District upon
  property within said District; and provided further that said
  District shall have none of the powers conferred by General Law for
  the purposes of the collection, transportation, processing,
  disposal and control of domestic, industrial or communal wastes,
  and the gathering, conducting, directing and controlling of local
  storm waters, or other local harmful excesses of water except as
  directly related to the production and purification of water for
  agricultural, municipal, or industrial purposes, including the
  ownership, lease, or operation of a municipal wastewater treatment
  facility in which the effluent is used by the District for water
  reuse supply.
         (c)  In the event that the District in the exercise of the
  power of eminent domain or power of relocation, or any other power
  granted hereunder, makes necessary the relocation, raising,
  rerouting or changing the grade of, or altering the construction
  of, any cemetery, highway, railroad, electric transmission line,
  telephone or telegraph properties and facilities, or pipeline, all
  such necessary relocation, raising, rerouting, changing of grade or
  alteration of construction shall be accomplished at the sole
  expense of the District. The term "sole expense" shall mean the
  actual cost of such relocation, raising, rerouting, or change in
  grade or alteration of construction in providing comparable
  replacement without enhancement of such facilities after deducting
  therefrom the net salvage value derived from the old facility.
         (f)  The powers, rights, privileges, and functions conferred
  upon the District shall be subject to the continuing rights of
  supervision by the State, [which shall be exercised by the Texas
  Department of Water Resources, and the District shall obtain
  approval of its projects and they shall be supervised] as provided
  by the [Sections 54.516 and 54.517,] Water Code, as amended.
         SECTION 4.  Section 5, Chapter 712, Acts of the 59th
  Legislature, Regular Session, 1965, is amended to read as follows:
         Sec. 5.  (a) The management and control of the District is
  hereby vested in a Board of 10 directors.
         (b)  Each director must be a resident of this state.
         (c)  Vacancies on the Board of Directors, whether by death,
  resignation or termination of the term of office, shall be filled by
  appointment by the commissioners court that appointed the director
  for the unexpired term of the director.
         (d)  A director may be removed by the commissioners court
  that appointed the director for inefficiency, neglect of duty, or
  misconduct of office. The Board must provide a director removed
  under this section written notice not later than the 30th day after
  the date the decision to remove is made and an opportunity to be
  heard in person or by counsel in a public hearing.
         (e)  All terms of office shall be for a period of two (2)
  years. Terms shall be staggered ending on August 31 of the
  appropriate year.
         (f)  Six directors constitute a quorum. Except as otherwise
  provided, a majority of those directors present and qualified to
  vote is sufficient for final action on a matter before the Board.
         SECTION 5.  Chapter 712, Acts of the 59th Legislature,
  Regular Session, 1965, is amended by adding Sections 5C, 5D, 5E, 5F,
  and 5G to read as follows:
         Sec. 5C.  (a) Chapter 171, Local Government Code, does not
  apply to a director appointed to represent agricultural or
  industrial interests.
         (b)  A director who has a financial interest in a contract
  considered by the District for the purchase of property or the
  construction of a facility must disclose the interest to the other
  directors and may not vote on the contract.
         Sec. 5D.  (a) The Board may hold an open or closed meeting by
  telephone conference call if at least five directors are present at
  the location where the meeting of the Board is held. A meeting held
  by telephone conference call is subject to the same notice
  requirements as other Board meetings and must be recorded. Each
  person who speaks in a meeting held by telephone conference call
  must be clearly identified. A director participating in a meeting
  held by telephone conference call is considered absent from any
  part of the meeting during which audio communication is lost.
         (b)  The authority to hold a meeting held by telephone
  conference call described by this section is in addition to
  authority described by Chapter 551, Government Code.
         Sec. 5E.  If the Board employs a general manager, the general
  manager is the chief executive officer of the District.
         Sec. 5F.  The District is not required to provide notice for
  the sale or disposal of District personal property if the personal
  property has a value of less than $25,000.
         Sec. 5G.  (a) The District may enter into a contract related
  to a water project located outside the District. The District may
  enter into a local agreement with a political subdivision for a
  purpose related to a water project.
         (b)  A contract under this section may use money appropriated
  by a political subdivision that is a party to the contract to pay
  for pre-development costs, engineering, surveys, and the
  collection and compilation of data relating to conditions
  influencing determinations about the character and extent of
  proposed improvements, works, and facilities for the
  accomplishment of District purposes.
         (c)  The District may contract or agree with an entity
  appropriating money under this section to receive a loan or money
  from other sources in return for services described by Subsection
  (a). The contract or agreement may provide for the repayment by the
  District of money advanced as a loan from project revenues, bond
  proceeds, or other available money.
         (d)  The District and a state agency or political subdivision
  may enter into a contract to jointly pay all or part of the cost of a
  water project or the operation of a water project in the same way
  that a political subdivision may contract with a state agency or
  political subdivision under Chapter 472, Transportation Code, to
  jointly pay all or part of the cost associated with a state or local
  highway, turnpike, road, or street project.
         SECTION 6.  Sections 7 and 8, Chapter 712, Acts of the 59th
  Legislature, Regular Session, 1965, are amended to read as follows:
         Sec. 7.  The District shall have power and is hereby
  authorized to issue, from time to time, bonds as herein authorized
  for any of its corporate purposes. Such bonds may either be (1)
  sold for cash, at public or private sale, at such price or prices as
  the Board shall determine, provided that the net effective interest
  rate, calculated in accordance with Chapter 1204, Government Code
  [3, Acts of the 61st Legislature, Regular Session, 1969, as amended
  (Article 717k-2, Vernon's Texas Civil Statutes), as now or
  hereafter amended shall not exceed ten (10) percent], or (2) issued
  on such terms as the Board of Directors shall determine in exchange
  for property of any kind, real, personal or mixed or any interest
  therein which the Board shall deem necessary for any such corporate
  purposes, or (3) issued in exchange for like principal amounts of
  other obligations of the District, matured or unmatured. The
  proceeds of sale of such bonds shall be deposited in such bank or
  banks or trust company or trust companies, and shall be paid out
  pursuant to such terms and conditions, as may be agreed upon between
  the District and the purchasers of such bonds. All such bonds shall
  be authorized by resolution or resolutions of the Board of
  Directors, and shall bear such date or dates, mature at such time or
  times, bear interest payable annually, semiannually, or otherwise,
  be in such denominations, be in such form, either coupon or
  registered, carry such registration privileges as to principal only
  or as to both principal and interest, and as to exchange of coupon
  bonds for registered bonds or vice versa, and exchange of bonds of
  one denomination for bonds of other denominations, be executed in
  such manner and be payable at such place or places within or without
  the State of Texas, as such resolution or resolutions may provide.
  Any resolution or resolutions authorizing any bonds may contain
  provisions, which shall be part of the contract between the
  District and the holders thereof from time to time:
         (a)  reserving the right to redeem such bonds or requiring
  the redemption of such bonds, at such time or times, in such amounts
  and at such prices, [not exceeding 105 percent of the principal
  amount thereof, plus accrued interest,] as may be provided;
         (b)  providing for the setting aside of sinking funds or
  reserve funds and the regulation and disposition thereof;
         (c)  pledging to secure the payment of the principal of and
  interest on such bonds and of the sinking fund or reserve fund
  payments agreed to be made in respect of such bonds all or any part
  of the gross or net revenues thereafter received by the District in
  respect of the property, real, personal, or mixed, to be acquired
  and/or constructed with such bonds or the proceeds thereof, or all
  or any part of the gross or net revenues thereafter received by the
  District from whatever source derived;
         (d)  prescribing the purposes to which such bonds or any
  bonds thereafter to be issued, or the proceeds thereof, may be
  applied;
         (e)  agreeing to fix and collect rates and charges sufficient
  to produce revenues adequate to pay (1)  all expenses necessary to
  the operation and maintenance and replacements and additions to the
  properties and facilities of the District; (2)  the principal of,
  and the interest and premium, if any, on bonds issued under this Act
  as and when the same became due and payable; (3)  all sinking fund
  and/or reserve fund payments agreed to be made in respect of any
  such bonds out of such revenues as and when the same became due and
  payable, and to fulfill the terms of any agreements made with the
  holders of such bonds and/or with any person on their behalf and to
  discharge all other lawful obligations of the District as and when
  the same become due;
         (f)  prescribing limitations upon the issuance of additional
  bonds and subordinate lien bonds and upon the agreements which may
  be made with the purchasers and successive holders thereof;
         (g)  with regard to the construction, extension,
  improvement, reconstruction, operation, maintenance, and repair of
  the properties of the District and carrying of insurance upon all or
  any part of said properties covering loss or damage or loss of use
  and occupancy resulting from specified risks;
         (h)  fixing the procedure, if any, by which, if the District
  shall so desire, the terms of any contract with the holders of such
  bonds may be amended or abrogated, the amount of bonds the holders
  of which must consent thereto, and the manner in which such consent
  may be given;
         (i)  for the execution and delivery by the District to a bank
  or trust company authorized by law to accept trusts, or to the
  United States of America or any officer or agency thereof, of
  indentures and agreements for the benefit of the holders of such
  bonds and such other provisions as may be customary in such
  indentures or agreements; and
         (j)  such other provisions, [not inconsistent with the
  provisions of this Act,] as the Board may approve.
         (k)  The Board may declare an emergency in the matter of
  funds not being available to pay principal of and interest on any
  bonds of the District or to meet any other needs of the District and
  may issue bond anticipation notes or enter into a loan to pay the
  costs to meet the emergency need. A loan under this section may be
  payable from district revenues or the proceeds of a future series of
  bonds. Bond anticipation notes may bear interest at any rate or
  rates not to exceed 10 percent and shall mature within one (1) year
  of their date. The bond anticipation notes so issued will be taken
  up with the proceeds of bonds, or the bonds may be issued and
  delivered in exchange for and in substitution of such notes.
         (l)  Before any bonds shall be sold or exchanged or
  substituted by the District, a certified copy of the proceedings of
  the issuance thereof, including the form of such bonds, together
  with any other information which the Attorney General of the State
  of Texas may require, shall be submitted to the Attorney General,
  and if he shall find that such bonds have been issued in accordance
  with law, and if he shall approve such bonds, he shall execute a
  certificate to that effect which shall be filed in the office of the
  Comptroller of the State of Texas and be recorded in a record kept
  for that purpose. No bonds shall be issued until the same shall
  have been registered by the Comptroller, who shall so register the
  same if the Attorney General shall have filed with the Comptroller
  his certificate approving the bonds and the proceedings for the
  issuance thereof as hereinabove provided.
         (m)  All bonds approved by the Attorney General as aforesaid,
  and registered by the Comptroller as aforesaid, and issued in
  accordance with the proceedings so approved shall be valid and
  binding obligations of the District and shall be incontestable for
  any cause from and after the time of such registration.
         (n)  If any bonds recite that they are secured by a pledge of
  the proceeds of a contract, lease, sale or other agreement (herein
  called "contract"), a copy of such contract and the proceedings of
  the contracting parties will also be submitted to the Attorney
  General. If such bonds have been authorized and such contracts made
  in compliance with law, the Attorney General shall approve the
  bonds and contracts, and the bonds shall then be registered by the
  Comptroller of Public Accounts. When so approved, such bonds and
  the contracts shall be valid and binding and shall be incontestable
  for any cause from and after the time of such registration.
         (o)  The District is authorized to make and issue bonds
  (herein called "refunding bonds") for the purpose of refunding or
  refinancing any outstanding bonds or notes authorized and issued by
  the District pursuant to this Act or other law (herein called
  "bonds") and the interest and premium, if any, thereon to maturity
  or on any earlier redemption date specified in the resolution
  authorizing the issuance of the refunding bonds. Such refunding
  bonds may be issued to refund more than one series of outstanding
  bonds, may combine the pledges of the outstanding bonds for the
  security of the refunding bonds, or may be secured by other or
  additional revenues. All provisions of this Act with reference to
  the issuance of bonds, the terms and provisions thereof, their
  approval by the Attorney General, and the remedies of the
  bondholders shall be applicable to refunding bonds. Refunding
  bonds shall be registered by the Comptroller upon surrender and
  cancellation of the bonds to be refunded, but in lieu thereof, the
  resolution authorizing the issuance of refunding bonds may provide
  that they shall be sold and the proceeds thereof deposited at the
  places at which the original bonds are payable, in which case the
  refunding bonds may be issued in an amount sufficient to pay the
  interest and premium, if any, on the original bonds to their
  maturity date or specified earlier redemption date, and the
  Comptroller will register them without concurrent surrender and
  cancellation of the original bonds. The District may also refund
  any outstanding bonds in the manner provided by any applicable
  General Law.
         (p)  All bonds issued by the District pursuant to the
  provisions of this Act shall constitute investment securities
  within the meaning of the Uniform Commercial Code.
         (q)  This Act, without reference to other statutes of the
  State of Texas, shall constitute full authority for the
  authorization and issuance of bonds hereunder, and no other Act or
  law with regard to the authorization or issuance of obligations or
  the deposit of the proceeds thereof, or in any impeding or
  restricting the carrying out of the acts herein authorized to be
  done shall be construed as applying to any proceedings taken
  hereunder or acts done pursuant hereto.
         Sec. 8.  (a) When any of such revenues are pledged to the
  payment of any bonds issued by said District or loans received by
  the District, it shall be the right and duty of the District's Board
  of Directors to cause to be fixed, maintained and enforced charges,
  fees or tolls for services rendered by properties and facilities,
  the revenues of which have been pledged, at rates and amounts at
  least sufficient to comply with and carry out the covenants and
  provisions contained in the order or orders authorizing the
  issuance of said bonds.
         (b)  Regardless of whether the revenues are pledged to the
  payment of bonds, the [The] District shall have the right to impose
  penalties for failure to pay, when due, such charges, fees or tolls.
         SECTION 7.  (a) The legal notice of the intention to
  introduce this Act, setting forth the general substance of this
  Act, has been published as provided by law, and the notice and a
  copy of this Act have been furnished to all persons, agencies,
  officials, or entities to which they are required to be furnished
  under Section 59, Article XVI, Texas Constitution, and Chapter 313,
  Government Code.
         (b)  The governor, one of the required recipients, has
  submitted the notice and Act to the Texas Commission on
  Environmental Quality.
         (c)  The Texas Commission on Environmental Quality has filed
  its recommendations relating to this Act with the governor, the
  lieutenant governor, and the speaker of the house of
  representatives within the required time.
         (d)  All requirements of the constitution and laws of this
  state and the rules and procedures of the legislature with respect
  to the notice, introduction, and passage of this Act are fulfilled
  and accomplished.
         SECTION 8.  This Act takes effect immediately if it receives
  a vote of two-thirds of all the members elected to each house, as
  provided by Section 39, Article III, Texas Constitution. If this
  Act does not receive the vote necessary for immediate effect, this
  Act takes effect September 1, 2019.