H.B. No. 3605
 
 
 
 
AN ACT
  relating to financial assistance awarded by the Texas Water
  Development Board for water supply projects.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 16.0121, Water Code, is amended by
  adding Subsections (g) and (h) to read as follows:
         (g)  A retail public utility providing potable water that
  receives from the board financial assistance shall use a portion of
  that financial assistance, or any additional financial assistance
  provided by the board for the purpose described by this subsection,
  to mitigate the utility's system water loss if, based on a water
  audit filed by the utility under this section, the water loss meets
  or exceeds the threshold established by board rule.
         (h)  For each category of retail public utility listed in
  Subsection (c), the board shall adopt rules regarding:
               (1)  the amount of system water loss that requires a
  utility to take action under Subsection (g); and
               (2)  the use of financial assistance from the board as
  required by Subsection (g) to mitigate system water loss.
         SECTION 2.  Subchapter D, Chapter 17, Water Code, is amended
  by adding Section 17.1245 to read as follows:
         Sec. 17.1245.  EVALUATION. (a) In passing on an application
  for financial assistance from a retail public utility that provides
  potable water service to 3,300 or more connections, the board
  shall:
               (1)  evaluate for compliance with the board's best
  management practices the utility's water conservation plan
  required under Section 13.146; and
               (2)  issue a report to a utility detailing the results
  of the evaluation conducted under Subdivision (1).
         (b)  Not later than January 1 of each odd-numbered year, the
  board shall submit to the legislature a written summary of the
  results of evaluations conducted under Subsection (a)(1).
         SECTION 3.  Section 17.183, Water Code, is amended to read as
  follows:
         Sec. 17.183.  CONSTRUCTION CONTRACT REQUIREMENTS. (a) The
  governing body of each political subdivision receiving financial
  assistance from the board shall require in all contracts for the
  construction of a project:
               (1)  that each bidder furnish a bid guarantee
  equivalent to five percent of the bid price;
               (2)  that each contractor awarded a construction
  contract furnish performance and payment bonds:
                     (A)  the performance bond shall include without
  limitation guarantees that work done under the contract will be
  completed and performed according to approved plans and
  specifications and in accordance with sound construction
  principles and practices; and
                     (B)  the performance and payment bonds shall be in
  a penal sum of not less than 100 percent of the contract price and
  remain in effect for one year beyond the date of approval by the
  engineer of the political subdivision; [and]
               (3)  that payment be made in partial payments as the
  work progresses;
               (4)  that each partial payment shall not exceed 95
  percent of the amount due at the time of the payment as shown by the
  engineer of the project, but, if the project is substantially
  complete, a partial release of the five percent retainage may be
  made by the political subdivision with approval of the executive
  administrator;
               (5)  that payment of the retainage remaining due upon
  completion of the contract shall be made only after:
                     (A)  approval by the engineer for the political
  subdivision as required under the bond proceedings;
                     (B)  approval by the governing body of the
  political subdivision by a resolution or other formal action; and
                     (C)  certification by the executive administrator
  in accordance with the rules of the board that the work to be done
  under the contract has been completed and performed in a
  satisfactory manner and in accordance with approved plans and
  specifications [sound engineering principles and practices];
               (6)  that no valid approval may be granted unless the
  work done under the contract has been completed and performed in a
  satisfactory manner according to approved plans and
  specifications; and
               (7)  that, if a political subdivision receiving
  financial assistance under Subchapter K of this chapter, labor from
  inside the political subdivision be used to the extent possible.
         (b)  Plans and specifications submitted to the board in
  connection with an application for financial assistance must
  include a seal by a licensed engineer affirming that the plans and
  specifications are consistent with and conform to current industry
  design and construction standards.
         SECTION 4.  Section 17.1245, Water Code, as added by this
  Act, applies only to an application for financial assistance
  submitted on or after the effective date of this Act. An
  application for financial assistance submitted before the
  effective date of this Act is governed by the law in effect on the
  date the application was submitted, and the former law is continued
  in effect for that purpose.
         SECTION 5.  This Act takes effect September 1, 2013.
 
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 3605 was passed by the House on May 2,
  2013, by the following vote:  Yeas 146, Nays 1, 2 present, not
  voting; and that the House concurred in Senate amendments to H.B.
  No. 3605 on May 24, 2013, by the following vote:  Yeas 146, Nays 0,
  2 present, not voting.
 
  ______________________________
  Chief Clerk of the House   
 
         I certify that H.B. No. 3605 was passed by the Senate, with
  amendments, on May 21, 2013, by the following vote:  Yeas 30, Nays
  1.
 
  ______________________________
  Secretary of the Senate   
  APPROVED: __________________
                  Date       
   
           __________________
                Governor