TO:	Honorable Tracy O. King, Chair, House Committee on Natural Resources
FROM:	Jerry McGinty, Director, Legislative Budget Board
IN RE:	HB5303 by Kuempel (relating to the creation of the Springs Hill Special Utility District; authorizing a fee; granting the power of eminent domain.), 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:

This bill creates Springs Hill Special Utility District (the “District”) with the powers and duties of a standard special utility district under Water Code Chapters 49 and 65.

Population: The 2020 population estimate for areas of Guadalupe County served by small water systems or private wells (‘County-Other') was 2,629. The Guadalupe County-Other population projections adopted for the 2022 State Water Plan projects the population to be 1,739 in 2030 and 2,064 in 2040.

The 2020 population estimate for areas of Wilson County served by small water systems or private wells (‘County-Other') was 6,952. The Wilson County-Other population projections adopted for the 2022 State Water Plan projects the population to be 7,061 in 2030 and 6,174 in 2040.

Location: The proposed district's initial boundaries are described as coextensive with the existing district Springs Hill WSC.

The proposed district's area is approximately 214 square miles encompassing central and southcentral Guadalupe County except for the City of Seguin. A small portion of the district is located in northern Wilson County, northeast of the City of La Vernia.

Comments on Powers/Duties from Similar Types of Districts: The bill specifies that if the creation of the District is confirmed, the Springs Hill Water Supply Corporation shall transfer the assets, debts, and contractual rights and obligations to the District. The bill specifies that the District may charge an initial water service impact fee that is not greater than the impact fee charged by the Springs Hill Water Supply Corporation on September 1, 2023. The District may amend the water service impact fee as approved by the TCEQ, or as otherwise provided by law. 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: Within Guadalupe County, 51% of the total water use was supplied by groundwater (Carrizo-Wilcox Aquifer), and municipal was the largest volume water use category comprising 68% of the county total water use in 2020.

Within Wilson County, 93% of the total water use was supplied by groundwater (Carrizo-Wilcox Aquifer), and irrigation was the largest volume water use category comprising 55% of the county total water use in 2020. Municipal use accounted for 36% of the county total water use in 2020. The water source the proposed district might pursue is unknown.