H.B. No. 101
 
 
 
 
AN ACT
  relating to the development of and contracting for reclaimed water
  facilities in certain municipalities.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Subchapter B, Chapter 552, Local Government
  Code, is amended by adding Section 552.024 to read as follows:
         Sec. 552.024.  MUNICIPAL CONTRACT FOR RECLAIMED WATER
  FACILITY IN CERTAIN MUNICIPALITIES. (a) In this section,
  "reclaimed water project" means the design, construction,
  equipment, repair, reconstruction, replacement, expansion,
  operation, or maintenance of:
               (1)  a reclaimed water facility with a capacity of not
  less than 10 million gallons per day to be owned by a municipality;
  and
               (2)  related infrastructure.
         (b)  This section applies only to a home-rule municipality
  that:
               (1)  has a population of at least 99,000 and not more
  than 160,000;
               (2)  is located in two counties, only one of which has a
  population of at least 132,000 and not more than 170,000; and
               (3)  owns and operates a water system, sewer system, or
  combined system.
         (c)  A municipality to which this section applies may
  execute, perform, and make payments under a contract with any
  person for the development of a reclaimed water project and the
  provision of water from that project.
         (d)  A contract entered into under this section is an
  obligation of the municipality that:
               (1)  may provide that:
                     (A)  the contract is payable from a pledge of the
  revenues of the water system, sewer system, or combined system of
  the municipality; or
                     (B)  the payments from the municipality are an
  operating expense of the water system, sewer system, or combined
  system of the municipality; and
               (2)  may not be made payable from ad valorem taxes.
         (e)  A contract entered into under this section may:
               (1)  be in the form and on the terms considered
  appropriate by the governing body of the municipality;
               (2)  be for the term approved by the governing body of
  the municipality and contain an option to renew or extend the term;
               (3)  provide for the design, construction, and
  financing of the reclaimed water project by the person with whom the
  municipality contracts for the development of the reclaimed water
  project; and
               (4)  provide for the provision of reclaimed water for
  industrial purposes at specified rates for the term approved by the
  governing body of the municipality as part of the consideration for
  the acquisition of the reclaimed water project by the municipality.
         (f)  If a contract entered into under this section provides
  for the design, construction, and financing of the reclaimed water
  project by the person with whom the municipality contracts:
               (1)  a contract procurement or delivery requirement
  applicable to the municipality does not apply to the reclaimed
  water project; and 
               (2)  Chapter 2254, Government Code, does not apply to
  the reclaimed water project.
         (g)  Subchapter I, Chapter 271, applies to a written contract
  entered into under this section as if the contract were a contract
  described by Section 271.151(2).
         (h)  To the extent of a conflict with another statute or
  municipal charter provision or ordinance, this section controls.
         (i)  The validity or enforceability of a contract entered
  into under this section by a municipality is not affected if, after
  the contract is entered into, the municipality no longer meets the
  requirements described by Subsection (b).
         SECTION 2.  This Act applies to a contract entered into
  before the effective date of this Act that is made contingent on
  this Act taking effect.
         SECTION 3.  This Act takes effect immediately if it receives
  a vote of two-thirds of all the members elected to each house, as
  provided by Section 39, Article III, Texas Constitution.  If this
  Act does not receive the vote necessary for immediate effect, this
  Act takes effect September 1, 2017.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 101 was passed by the House on March
  22, 2017, by the following vote:  Yeas 145, Nays 0, 1 present, not
  voting.
 
  ______________________________
  Chief Clerk of the House   
 
 
         I certify that H.B. No. 101 was passed by the Senate on May
  11, 2017, by the following vote:  Yeas 31, Nays 0.
 
  ______________________________
  Secretary of the Senate    
  APPROVED:  _____________________
                     Date          
   
            _____________________
                   Governor