bill counting public utility agencies as water and sewer utilities

The text as introduced · 1,147 words

89R10424 SCR-F

By: Eckhardt
S.B. No. 2389

A BILL TO BE ENTITLED

AN ACT

relating to entities authorized to provide water or sewer service.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Sections 572.052(c) and (d), Local Government

Code, are amended to read as follows:

(c) A public utility agency is a:

(1) separate agency;

(2) political subdivision of this state; [ and ]

(3) political entity and corporate body ; and

(4) retail public utility for the purposes of Chapter

13, Water Code .

(d) A public utility agency may not impose a tax but has all

the other powers and obligations that are related to facilities and

that are provided by law to a municipality that owns a facility ,

except as provided by Section 572.061 .

SECTION 2. Chapter 572, Local Government Code, is amended

by adding Subchapter D to read as follows:

SUBCHAPTER D. RECEIVERSHIP AND TEMPORARY MANAGEMENT

Sec. 572.101. DEFINITIONS. In this subchapter:

(1) "Commission" means the Texas Commission on

Environmental Quality.

(2) "Utility" and "water supply or sewer service

corporation" have the meanings assigned by Section 13.002, Water

Code.

(3) "Utility commission" means the Public Utility

Commission of Texas.

Sec. 572.102. APPLICABILITY. (a) This subchapter applies

only to a utility or water supply or sewer service corporation

providing water or sewer service in the territory of a public

utility agency.

(b) For purposes of this subchapter, a reference in Chapter

13, Water Code, to a person includes a public utility agency.

Sec. 572.103. RECEIVERSHIP. (a) At the request of the

utility commission or the commission, the attorney general shall

bring suit for the appointment of a receiver that is a public

utility agency in the manner provided by Section 13.412, Water

Code, to collect the assets and carry on the business of a utility

or water supply or sewer service corporation that:

(1) has abandoned operation of its facilities;

(2) informs the utility commission or the commission

that the owner is abandoning the system;

(3) violates a final order of the utility commission

or the commission;

(4) allows any property owned or controlled by it to be

used in violation of a final order of the utility commission or the

commission;

(5) violates a final judgment issued by a district

court in a suit brought by the attorney general under:

(A) Chapter 7 or 13, Water Code; or

(B) Chapter 341, Health and Safety Code;

(6) is subject to an administrative penalty for a

violation of Subchapter M, Chapter 13, Water Code, or a rule adopted

by the utility commission under that subchapter; or

(7) violates a final judgment issued by a court in a

proceeding to enforce a provision of a permit issued by a

groundwater conservation district under Chapter 36.

(b) To facilitate the regionalization of water and sewer

service, the utility commission shall prioritize an application

submitted under Section 13.412(g), Water Code, by a public utility

agency. The utility commission shall issue an order approving the

acquisition proposed in the application not later than the 120th

day after the date the utility commission determines the

application is complete.

Sec. 572.104. TEMPORARY MANAGEMENT. The utility commission

or the commission, after providing to the utility or water supply or

sewer service corporation notice and an opportunity to be heard by

the commissioners at a utility commission or commission meeting,

may authorize a public utility agency to temporarily manage and

operate a utility or water supply or sewer service corporation in

the manner provided by Section 13.4132, Water Code, if the utility

or corporation:

(1) has discontinued or abandoned operations or the

provision of services;

(2) has been or is being referred to the attorney

general for the appointment of a receiver under Section 572.103; or

(3) provides retail water or sewer utility service

through fewer than 10,000 taps or connections and violates a final

order of the commission by failing to:

(A) provide system capacity that is greater than

the required raw water or groundwater production rate or the

anticipated daily demand of the system;

(B) provide a minimum pressure of 35 pounds per

square inch throughout the distribution system under normal

operating conditions; or

(C) maintain accurate or properly calibrated

testing equipment or other means of monitoring the effectiveness of

a chemical treatment or pathogen inactivation or removal process.

SECTION 3. Section 13.002, Water Code, is amended by adding

Subdivision (16-a) and amending Subdivisions (19) and (23) to read

as follows:

(16-a) "Public utility agency" means a public utility

agency created under Chapter 572, Local Government Code.

(19) "Retail public utility" means any person,

corporation, public utility, water supply or sewer service

corporation, municipality, public utility agency, political

subdivision or agency operating, maintaining, or controlling in

this state facilities for providing potable water service or sewer

service, or both, for compensation.

(23) "Water and sewer utility," "public utility," or

"utility" means any person, corporation, cooperative corporation,

affected county, or any combination of these persons or entities,

other than a municipal corporation, public utility agency, water

supply or sewer service corporation, or [ a ] political subdivision

of the state, except an affected county, or their lessees,

trustees, and receivers, owning or operating for compensation in

this state equipment or facilities for the transmission, storage,

distribution, sale, or provision of potable water to the public or

for the resale of potable water to the public for any use or for the

collection, transportation, treatment, or disposal of sewage or

other operation of a sewage disposal service for the public, other

than equipment or facilities owned and operated for either purpose

by a municipality or other political subdivision of this state or a

water supply or sewer service corporation, but does not include any

person or corporation not otherwise a public utility that furnishes

the services or commodity only to itself or its employees or tenants

as an incident of that employee service or tenancy when that service

or commodity is not resold to or used by others.

SECTION 4. Section 13.004(a), Water Code, is amended to

read as follows:

(a) Notwithstanding any other law, the utility commission

has the same jurisdiction over a water supply or sewer service

corporation that the utility commission has under this chapter over

a water and sewer utility if the utility commission finds that the

water supply or sewer service corporation:

(1) is failing to conduct annual or special meetings

in compliance with Section 67.007; [ or ]

(2) is operating in a manner that does not comply with

the requirements for classifications as a nonprofit water supply or

sewer service corporation prescribed by Sections 13.002(11) and

(24) ; or

(3) is operating in a manner that necessitates

appointment of a receiver or temporary manager for the water supply

or sewer service corporation in the manner provided by Subchapter

K .

SECTION 5. This Act takes effect September 1, 2025.