S.B. No. 2014

	AN ACT
	relating to the administration of certain water districts.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 49.181, Water Code, is amended by
	amending Subsection (f) and adding Subsections (i), (j), (k), and
	(l) to read as follows:
	(f)  The commission shall determine whether the project to be
	financed by the bonds is feasible and issue an order either
	approving or disapproving, as appropriate, the issuance of the
	bonds. If the commission determines that an application for the
	approval of bonds complies with the requirements for financial
	feasibility and the district submitting the application is not
	required to comply with rules regarding project completion, the
	commission may not disapprove the issuance of bonds for all or a
	portion of a project or require that the funding for all or a
	portion of a project be escrowed solely on the basis that the
	construction of the project is not complete at the time of the
	commission's determination. The commission shall retain a copy of
	the order and send a copy of the order to the district.
	(i)  An application for the approval of bonds under this
	section may include financing for payment of creation and
	organization expenses. Expenses are creation and organization
	expenses if the expenses were incurred through the date of the
	canvassing of the confirmation election. A commission rule
	regarding continuous construction periods or the length of time for
	the payment of expenses during construction periods does not apply
	to expenses described by this section.
	(j)  The commission shall approve an application to issue
	bonds to finance the costs of spreading and compacting fill to
	remove property from the 100-year floodplain made by a levee
	improvement district if the application otherwise meets all
	applicable requirements for bond applications.
	(k)  The commission shall approve an application to issue
	bonds to finance the costs of spreading and compacting fill to
	provide drainage that is made by a municipal utility district or a
	district with the powers of a municipal utility district if the
	costs are less than the cost of constructing or improving drainage
	facilities.
	(l)  If a district is approved for the issuance of bonds by
	the commission to use a certain return flow of wastewater, the
	approval applies to subsequent bond authorizations unless the
	district seeks approval to use a different return flow of
	wastewater.
	SECTION 2.  Section 49.273(i), Water Code, is amended to
	read as follows:
	(i)  If changes in plans, [or] specifications, or scope of
	work are necessary or beneficial to the district, as determined by
	the board, after the performance of the contract is begun, or if it
	is necessary or beneficial to the district, as determined by the
	board, to decrease or increase the quantity of the work to be
	performed or of the materials, equipment, or supplies to be
	furnished, the board may approve change orders making the changes.
	The board may grant authority to an official or employee
	responsible for purchasing or for administering a contract to
	approve a change order that involves an increase or decrease of
	$50,000 or less.  The aggregate of the change orders that [may not]
	increase the original contract price by more than 25 percent[.
	Additional change orders] may be issued only as a result of
	unanticipated conditions encountered during construction, repair,
	or renovation or changes in regulatory criteria or to facilitate
	project coordination with other political entities.  A change order
	is not subject to the requirements of Subsection (d) or (e).
	SECTION 3.  Section 49.302(b), Water Code, is amended to
	read as follows:
	(b)  A petition requesting the annexation of a defined area
	signed by a majority in value of the owners of land in the defined
	area, as shown by the tax rolls of the central appraisal district of
	the county or counties in which such area is located, [or signed by
	50 landowners if the number of landowners is more than 50,] shall
	describe the land by metes and bounds or by lot and block number if
	there is a recorded plat of the area and shall be filed with the
	secretary of the board.
	SECTION 4.  Section 54.014, Water Code, is amended to read as
	follows:
	Sec. 54.014.  PETITION. When it is proposed to create a
	district, a petition requesting creation shall be filed with the
	commission. The petition shall be signed by a majority in value of
	the holders of title of the land within the proposed district, as
	indicated by the tax rolls of the central appraisal district. [If
	there are more than 50 persons holding title to the land in the
	proposed district, as indicated by the tax rolls of the central
	appraisal district, the petition is sufficient if it is signed by 50
	holders of title to the land.]
	SECTION 5.  Sections 54.016(a), (b), and (f), Water Code,
	are amended to read as follows:
	(a)  No land within the corporate limits of a city or within
	the extraterritorial jurisdiction of a city, shall be included in a
	district unless the city grants its written consent, by resolution
	or ordinance, to the inclusion of the land within the district in
	accordance with Section 42.042, Local Government Code, and this
	section. The request to a city for its written consent to the
	creation of a district, shall be signed by a majority in value of
	the holders of title of the land within the proposed district as
	indicated by the county tax rolls [or, if there are more than 50
	persons holding title to the land in the proposed district as
	indicated by the county tax rolls, the request to the city will be
	sufficient if it is signed by 50 holders of title to the land in the
	district]. A petition for the written consent of a city to the
	inclusion of land within a district shall describe the boundaries
	of the land to be included in the district by metes and bounds or by
	lot and block number, if there is a recorded map or plat and survey
	of the area, and state the general nature of the work proposed to be
	done, the necessity for the work, and the cost of the project as
	then estimated by those filing the petition. If, at the time a
	petition is filed with a city for creation of a district, the
	district proposes to connect to a city's water or sewer system or
	proposes to contract with a regional water and wastewater provider
	which has been designated as such by the commission as of the date
	such petition is filed, to which the city has made a capital
	contribution for the water and wastewater facilities serving the
	area, the proposed district shall be designated as a "city service
	district." If such proposed district does not meet the criteria for
	a city service district at the time the petition seeking creation is
	filed, such district shall be designated as a "noncity service
	district." The city's consent shall not place any restrictions or
	conditions on the creation of a noncity service district as defined
	by this chapter [Chapter 54 of the Texas Water Code] other than
	those expressly provided in Subsection (e) of this section and
	shall specifically not limit the amounts of the district's bonds. A
	city may not require annexation as a consent to creation of any
	district. A city shall not refuse to approve a district bond issue
	for any reason except that the district is not in compliance with
	valid consent requirements applicable to the district. If a city
	grants its written consent without the concurrence of the applicant
	to the creation of a noncity service district containing conditions
	or restrictions that the petitioning land owner or owners
	reasonably believe exceed the city's powers, such land owner or
	owners may petition the commission to create the district and to
	modify the conditions and restrictions of the city's consent. The
	commission may declare any provision of the consent to be null and
	void. The commission may approve the creation of a district that
	includes any portion of the land covered by the city's consent to
	creation of the district.  The legislature may create and may
	validate the creation of a district that includes any portion of the
	land covered by the city's consent to the creation of the district.
	(b)  If the governing body of a city fails or refuses to grant
	permission for the inclusion of land within its extraterritorial
	jurisdiction in a district, including a district created by a
	special act of the legislature, within 90 days after receipt of a
	written request, a majority of the electors in the area proposed to
	be included in the district or the owner or owners of 50 percent or
	more of the land to be included may petition the governing body of
	the city and request the city to make available to the land the
	water or sanitary sewer service contemplated to be provided by the
	district.
	(f)  A city may provide in its written consent for the
	inclusion of land in a district that is initially located wholly or
	partly outside the corporate limits of the city that a contract
	("allocation agreement") between the district and the city be
	entered into prior to the first issue of bonds, notes, warrants, or
	other obligations of the district.  The allocation agreement shall
	contain the following provisions:
	(1)  a method by which the district shall continue to
	exist following the annexation of all territory within the district
	by the city, if the district is [initially] located outside the
	corporate limits of the city at the time the creation of the
	district is approved by the district's voters;
	(2)  an allocation of the taxes or revenues of the
	district or the city which will assure that, following the date of
	the inclusion of all the district's territory within the corporate
	limits of the city, the total annual ad valorem taxes collected by
	the city and the district from taxable property within the district
	does not exceed an amount greater than the city's ad valorem tax
	upon such property;
	(3)  an allocation of governmental services to be
	provided by the city or the district following the date of the
	inclusion of all of the district's territory within the corporate
	limits of the city; and
	(4)  such other terms and conditions as may be deemed
	appropriate by the city.
	SECTION 6.  The change in law made to Section 54.016(f),
	Water Code, as amended by this Act, applies only to an agreement
	entered into on or after the effective date of this Act. An
	agreement entered into before the effective date of this Act is
	governed by the law in effect on the date the agreement was entered
	into, and the former law is continued in effect for that purpose.
	SECTION 7.  This Act takes effect September 1, 2017.
	______________________________	______________________________
	President of the Senate	Speaker of the House
	I hereby certify that S.B. No. 2014 passed the Senate on
	May 11, 2017, by the following vote:  Yeas 31, Nays 0;
	May 26, 2017, Senate refused to concur in House amendments and
	requested appointment of Conference Committee; May 27, 2017, House
	granted request of the Senate; May 28, 2017, Senate adopted
	Conference Committee Report by the following vote:  Yeas 31,
	Nays 0.
	______________________________
	Secretary of the Senate
	I hereby certify that S.B. No. 2014 passed the House, with
	amendments, on May 24, 2017, by the following vote:  Yeas 146,
	Nays 0, two present not voting; May 27, 2017, House granted request
	of the Senate for appointment of Conference Committee;
	May 28, 2017, House adopted Conference Committee Report by the
	following vote:  Yeas 144, Nays 2, two present not voting.
	______________________________
	Chief Clerk of the House
	Approved:
	______________________________
	Date
	______________________________
	Governor