BILL ANALYSIS

 

 

Senate Research Center

H.B. 685

89R1266 CS-F

By: Bell, Cecil (Creighton)

 

Water, Agriculture and Rural Affairs

 

5/8/2025

 

Engrossed

 

 

 

AUTHOR'S / SPONSOR'S STATEMENT OF INTENT

 

In 2023, First Liberty Institute, a legal organization that advocates for religious freedom and is known for providing counsel in the case Kennedy v. Bremerton School District, filed a lawsuit in Montgomery County asserting that their client, Grace Community Church, had been unfairly charged an elevated fee for the installation of a water tap by a municipally owned utility. The author of the bill has informed the committee that this lawsuit has raised the concern that some utilities are imposing a "fee-in-lieu-of-taxes" model on tax-exempt organizations. H.B. 685 seeks to alleviate this issue by prohibiting such a practice.

 

H.B. 685 amends current law relating to rates established by municipalities for water or sewer service for certain entities.

 

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 Subchapter Z, Chapter 552, Local Government Code, by adding Section 552.916, as follows:

 

Sec. 552.916. PROHIBITION ON RATE DISCRIMINATION. Prohibits a municipality from establishing a rate for water or sewer utility service applicable only to entities that qualify for a sales tax or ad valorem tax exemption that is higher than a rate established for entities that receive comparable utility service.

 

SECTION 2. Effective date: September 1, 2025.