The bill deletes the provision allowing utilities to recover reasonable appeal expenses.
The bill stops the state utility commission from letting a water or sewer utility recover its own costs of fighting a rate appeal. Instead, customers who hire a lawyer and win an appeal claiming rates are excessive can recover their attorney fees, expert witness fees and other costs, while a utility can recover its attorney fees only if the commission finds the appeal was groundless, brought in bad faith and meant to harass. The change applies to appeals filed on or after September 1, 2025, and it also drops the old rule that limited the commission to the information the local governing body had when it set rates.
Labels
Labels: GOT HALFWAY. Passed the Senate on Apr 24, 2025. Died in the House: never got out of the Natural Resources committee.
relating to expenses incurred in the appeal of rates for water or
sewer service charged to certain customers.
WHAT IT DOES
The bill deletes the provision allowing utilities to recover reasonable appeal expenses.
The bill stops the state utility commission from letting a water or sewer utility recover its own costs of fighting a rate appeal. Instead, customers who hire a lawyer and win an appeal claiming rates are excessive can recover their attorney fees, expert witness fees and other costs, while a utility can recover its attorney fees only if the commission finds the appeal was groundless, brought in bad faith and meant to harass. The change applies to appeals filed on or after September 1, 2025, and it also drops the old rule that limited the commission to the information the local governing body had when it set rates.
CHARGES
[ ] NONE FOUND
TOTAL
No significant fiscal implication to the State is anticipated.
Names were not printed for yea. Only the named positions are included in member records.
The journal row lists three votes in order: passage to engrossment, suspension of the three-day rule, and final passage. This entry records final passage. Repeated tallies belong to separate votes.
Sources
CSSB 2161 (Flores) Relating to expenses incurred in the appeal of rates for water or sewer service charged to certain customers. (viva voce vote) (26-5) "Nays" Cook, Eckhardt, Gutierrez, Menéndez, Schwertner (26-5) "Nays" Cook, Eckhardt, Gutierrez, Menéndez, Schwertner
Published stock of positions for this vote, except where marked derived.
Yea: 26 (published)
Nay: 5 (published)
Present, not voting: Not printed
Absent: Not printed
Excused: Not printed
Senate journal. Source snapshot 2026-10-19, Central time.
Names were not printed for yea. Only the named positions are included in member records.
The journal row lists three votes in order: passage to engrossment, suspension of the three-day rule, and final passage. This entry records suspension of the three-day rule. Repeated tallies belong to separate votes.
Sources
CSSB 2161 (Flores) Relating to expenses incurred in the appeal of rates for water or sewer service charged to certain customers. (viva voce vote) (26-5) "Nays" Cook, Eckhardt, Gutierrez, Menéndez, Schwertner (26-5) "Nays" Cook, Eckhardt, Gutierrez, Menéndez, Schwertner
Published stock of positions for this vote, except where marked derived.
Yea: 26 (published)
Nay: 5 (published)
Present, not voting: Not printed
Absent: Not printed
Excused: Not printed
Senate journal. Source snapshot 2026-10-19, Central time.
Names were not printed. No individual positions are inferred.
The journal row lists three votes in order: passage to engrossment, suspension of the three-day rule, and final passage. This entry records passage to engrossment. Repeated tallies belong to separate votes.
Voice vote. No numeric tally or individual yeas are inferred.
Sources
CSSB 2161 (Flores) Relating to expenses incurred in the appeal of rates for water or sewer service charged to certain customers. (viva voce vote) (26-5) "Nays" Cook, Eckhardt, Gutierrez, Menéndez, Schwertner (26-5) "Nays" Cook, Eckhardt, Gutierrez, Menéndez, Schwertner
Published stock of positions for this vote, except where marked derived.
Yea: Not printed
Nay: Not printed
Present, not voting: Not printed
Absent: Not printed
Excused: Not printed
Senate journal. Source snapshot 2026-10-19, Central time.
Witnesses10
For
2
Against
7
On
1
Names
For
Self2 registrations
Against
City of Garland, Texas2 registrations
City of Georgetown1 registration
City of San Antonio1 registration
San Antonio Water System (SAWS)1 registration
Society of Native Nations1 registration
Texas Municipal League1 registration
On
Public Utility Commission of Texas1 registration
Sources
10 parsed registrations across the loaded witness lists.
Derived stock of witness registrations. Repeated appearances count separately. Organizations and self-representation appear as printed.
Data snapshot Nov 1, 2026 at 10:30 AM CST. Grades, charges, quotes and corrections follow the published record.
House committee · Natural Resources · Final status: Died in committee
Senate committee · Water, Agriculture and Rural Affairs · Committee vote 7 aye, 0 nay, 2 absent · Out of committee
Subjects
Civil Remedies & Liabilities
Utilities--General
Utilities--Water & Sewer
PUBLIC UTILITY COMMISSION
Text
The text as introduced · 453 words
89R13872 CS-D
By: Flores
S.B. No. 2161
A BILL TO BE ENTITLED
AN ACT
relating to expenses incurred in the appeal of rates for water or
sewer service charged to certain customers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 13.043, Water Code, is amended by
amending Subsection (e) and adding Subsections (e-1) and (e-2) to
read as follows:
(e) In an appeal under Subsection (b), the utility
commission shall hear the appeal de novo and shall fix in its final
order the rates the governing body should have fixed in the action
from which the appeal was taken. The utility commission may
establish the effective date for the utility commission's rates at
the original effective date as proposed by the service provider
and [ , ] may order refunds or allow a surcharge to recover lost
revenues[ , and may allow recovery of reasonable expenses incurred
by the retail public utility in the appeal proceedings. The utility
commission may consider only the information that was available to
the governing body at the time the governing body made its decision
and evidence of reasonable expenses incurred by the retail public
utility in the appeal proceedings ]. The rates established by the
utility commission in an appeal under Subsection (b) remain in
effect until the first anniversary of the effective date proposed
by the retail public utility for the rates being appealed or until
changed by the service provider, whichever date is later, unless
the utility commission determines that a financial hardship exists.
(e-1) Any party represented by counsel who alleges that
existing rates are excessive or that rates prescribed by a
governing body are excessive and who is a prevailing party in
proceedings for review of a governing body decision may in the same
action recover reasonable fees for attorneys and expert witnesses
and other costs incurred by the prevailing party before the utility
commission. The amount of the attorney's fees shall be fixed by the
utility commission.
(e-2) On a finding by the utility commission that an action
under this subchapter was groundless and brought in bad faith and
for the purpose of harassment, the utility commission may award to
the defendant retail public utility reasonable attorney's fees.
SECTION 2. The changes in law made by this Act apply only to
an appeal under Section 13.043(b), Water Code, that is filed on or
after the effective date of this Act. An appeal that is filed
before the effective date of this Act is governed by the law in
effect on the date the appeal was filed, and the former law is
continued in effect for that purpose.
SECTION 3. This Act takes effect September 1, 2025.
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