bill on cities taking over water and sewer service

The text as introduced · 1,146 words

89R1848 CXP-D

By: Flores
S.B. No. 947

A BILL TO BE ENTITLED

AN ACT

relating to a certificate of public convenience and necessity to

provide water or sewer service in an area incorporated or annexed by

a municipality.

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

SECTION 1. Sections 13.255(c), (d), (e), (f), and (i),

Water Code, are amended to read as follows:

(c) The utility commission by order shall grant single

certification to the municipality. [ The utility commission shall

also determine in its order the monetary amount that is adequate and

just to compensate the retail public utility for any of the retail

public utility's property the utility commission determines is

being rendered useless or valueless by the single certification. ]

If the municipality in its application has requested the transfer

of specified property of the retail public utility to the

municipality or to a franchised utility, the utility commission

shall also determine in its order the adequate and just

compensation to be paid , under the provisions of this section, for

the transferred [ such ] property and [ pursuant to the provisions of

this section, including an award for ] damages to or adverse effects

on property remaining in the ownership of the retail public utility

after single certification. The order of the utility commission

shall not be effective to transfer property. A transfer of property

may be obtained under this section only by a court judgment rendered

under Subsection (d) or (e). The grant of single certification by

the utility commission takes effect on the date the municipality or

franchised utility, as the case may be, pays adequate and just

compensation pursuant to court order, or pays an amount into the

registry of the court or to the retail public utility under

Subsection (f). If the court judgment provides that the retail

public utility is not entitled to any compensation, the grant of

single certification takes effect when the court judgment becomes

final.

(d) In the event the final order of the utility commission

is not appealed within 30 days, the municipality may request the

district court of Travis County to enter a judgment consistent with

the order of the utility commission. In such event, the court shall

render a judgment that:

(1) transfers to the municipally owned utility or

franchised utility title to property to be transferred to the

municipally owned utility or franchised utility as delineated by

the utility commission's final order [ and property determined by

the utility commission to be rendered useless or valueless by the

granting of single certification ]; and

(2) orders payment to the retail public utility of

adequate and just compensation [ for the property ] as determined by

the utility commission in its final order under Subsection (c) .

(e) Any party that is aggrieved by a final order of the

utility commission under this section may file an appeal with the

district court of Travis County within 30 days after the order

becomes final. The hearing in such an appeal before the district

court shall be by trial de novo on all issues. After the hearing, if

the court determines that the municipally owned utility or

franchised utility is entitled to single certification under the

provisions of this section, the court shall enter a judgment that:

(1) transfers to the municipally owned utility or

franchised utility title to property requested by the municipality

to be transferred to the municipally owned utility or franchised

utility and located within the singly certificated area [ and

property determined by the court or jury to be rendered useless or

valueless by the granting of single certification ]; and

(2) orders payment in accordance with Subsection (g)

to the retail public utility of adequate and just compensation for

the property transferred , and for the property remaining in the

ownership of the retail public utility after single certification

that is damaged or adversely affected, as determined by the court or

jury.

(f) Transfer of property shall be effective on the date the

judgment becomes final. However, after the judgment of the court is

entered, the municipality or franchised utility may take possession

of transferred [ condemned ] property pending appeal if the

municipality or franchised utility pays the retail public utility

or pays into the registry of the court, subject to withdrawal by the

retail public utility, the amount, if any, established in the

court's judgment as just and adequate compensation. To provide

security in the event an appellate court, or the trial court in a

new trial or on remand, awards compensation in excess of the

original award, the municipality or franchised utility, as the case

may be, shall deposit in the registry of the court an additional sum

in the amount of the award, or a surety bond in the same amount

issued by a surety company qualified to do business in this state,

conditioned to secure the payment of an award of compensation

[ damages ] in excess of the original award of the trial court. On

application by the municipality or franchised utility, the court

shall order that funds deposited in the registry of the court be

deposited in an interest-bearing account, and that interest

accruing prior to withdrawal of the award by the retail public

utility be paid to the municipality or to the franchised utility.

In the event the municipally owned utility or franchised utility

takes possession of property or provides utility service in the

singly certificated area pending appeal, and a court in a final

judgment in an appeal under this section holds that the grant of

single certification was in error, the retail public utility is

entitled to seek compensation for any damages sustained by it in

accordance with Subsection (g) of this section.

(i) In the event that a municipality files an application

for single certification on behalf of a franchised utility, the

municipality shall be joined in such application by such franchised

utility, and the franchised utility shall make all payments

required in the court's judgment to adequately and justly

compensate the retail public utility [ for any taking or damaging of

property and ] for the transfer of property to such franchised

utility and for the property remaining in the ownership of the

retail public utility after single certification that is damaged or

adversely affected .

SECTION 2. The changes in law made by this Act apply only to

a proceeding affecting a certificate of public convenience and

necessity that commences on or after the effective date of this Act.

A proceeding affecting a certificate of public convenience and

necessity that commenced before the effective date of this Act is

governed by the law in effect on the date the proceeding is

commenced, and that law is continued in effect for that purpose.

SECTION 3. This Act takes effect September 1, 2025.