Bill Text: TX HB2400 | 2011-2012 | 82nd Legislature | Comm Sub
Bill Title: Relating to the powers and duties of the Texas Commission on Environmental Quality and other entities regarding water and sewer utilities and certain conservation and reclamation districts.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced - Dead) 2011-05-05 - Returned to committee [HB2400 Detail]
Download: Texas-2011-HB2400-Comm_Sub.html
82R19661 RWG-D | |||
By: Miller of Comal | H.B. No. 2400 | ||
Substitute the following for H.B. No. 2400: | |||
By: Martinez Fischer | C.S.H.B. No. 2400 |
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relating to the powers and duties of the Texas Commission on | ||
Environmental Quality and other entities regarding water and sewer | ||
utilities and certain conservation and reclamation districts. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 13.002(22), Water Code, is amended to | ||
read as follows: | ||
(22) "Test year" means the annualized period for which | ||
costs are to be analyzed and rates established [ |
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SECTION 2. Section 13.145(a), Water Code, is amended to | ||
read as follows: | ||
(a) A utility may consolidate more than one system under a | ||
single tariff on a regional basis [ |
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conservation for single-family residences and landscape | ||
irrigation. | ||
SECTION 3. Section 13.185(d), Water Code, is amended to | ||
read as follows: | ||
(d) Net income is the total revenues of the utility less all | ||
reasonable and necessary expenses as determined by the regulatory | ||
authority. The regulatory authority shall base a utility's | ||
expenses on information for either, at the utility's choice, a | ||
historic test year that is the most recent 12-month period that | ||
ended less than 12 months before the filing date of the rate | ||
application or the future test year of the 12-month period ending on | ||
the first anniversary of the filing date of the rate application for | ||
which representative and supporting information for the utility is | ||
available. The regulatory authority shall determine expenses and | ||
revenues in a manner consistent with Subsections (e) through (h) of | ||
this section. | ||
SECTION 4. Sections 13.187(a), (b), (d), (e), (f), (k), | ||
(o), and (p), Water Code, are amended to read as follows: | ||
(a) A utility may not make changes in its rates except by | ||
delivering a statement of intent to each ratepayer and [ |
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regulatory authority having original jurisdiction at least 90 [ |
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days before the proposed effective date of the proposed change. The | ||
proposed effective date of the new rates must be the first day of a | ||
billing period, and the new rates may not apply to service received | ||
before the proposed effective date of the new rates. The statement | ||
of intent must include: | ||
(1) the utility's name, address, current rates, and | ||
proposed rates [ |
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(2) a billing comparison regarding the existing water | ||
or sewer rate and the new water or sewer rate computed that shows | ||
the monthly water charges generated for use of the following | ||
amounts of water and the monthly sewer charges generated if the | ||
amount used was the same as a customer's winter monthly average, | ||
unless the utility proposes a flat rate for sewer service, for the | ||
use of: | ||
(A) 5,000 [ |
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(B) 10,000 [ |
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(C) 15,000 gallons of water or sewer; and | ||
(D) 30,000 gallons of water or sewer; | ||
(3) the effective date of the proposed rates; | ||
(4) information on the procedure for protesting a rate | ||
change, the minimum number of protests needed to ensure a hearing, | ||
and the length of the protest period; | ||
(5) contact information for the commission and the | ||
office of public interest counsel; | ||
(6) a brief description of the contested case hearing | ||
process; and | ||
(7) any additional information required by the | ||
regulatory authority's rules [ |
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(b) A copy of the statement of intent shall be mailed or | ||
delivered to the appropriate offices of each affected municipality, | ||
to the executive director, and to any [ |
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required by the regulatory authority's rules. | ||
(d) If [ |
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application or the statement of intent is not substantially | ||
complete or does not comply with the regulatory authority's rules, | ||
it may be rejected and the proposed effective date of the rate | ||
change may be suspended until a properly completed application is | ||
accepted by the regulatory authority and a proper statement of | ||
intent is provided. The commission may also suspend the proposed | ||
effective date of any rate change if the utility does not have a | ||
certificate of public convenience and necessity or a completed | ||
application for a certificate or to transfer a certificate pending | ||
before the commission or if the utility is delinquent in paying the | ||
assessment and any applicable penalties or interest required by | ||
Section 5.701(n) of this code. | ||
(e) The regulatory authority shall hold a hearing on the | ||
proposed rate increase if [ |
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authority and each ratepayer under Subsection (a) [ |
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affected municipality, or from the lesser of 1,000 or 10 percent of | ||
the ratepayers of the utility over whose rates the regulatory | ||
authority has original jurisdiction[ |
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(f) The regulatory authority may set the matter for hearing | ||
on its own motion at any time within 90 [ |
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authority and each ratepayer under Subsection (a) [ |
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service in a county with a population of more than 2.5 million, the | ||
hearing must be held at a location in that county. | ||
(k) If the regulatory authority sets the matter for | ||
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Subsection (e), the regulatory authority shall [ |
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hearing and a decision, suspend the date the rate change would | ||
otherwise be effective until the date the regulatory authority | ||
issues a final decision on the matter. The administrative law judge | ||
shall issue a proposal for decision not later than the 120th day | ||
after the last date of the preliminary hearing. The commission | ||
shall issue a final decision not later than the 60th day after the | ||
date the administrative law judge issues the proposal for decision. | ||
The executive director may extend the process if the commission | ||
determines that an extension is necessary to protect a party's | ||
right to due process or other constitutional right. [ |
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(o) If the [ |
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on the proposed rate increase under Subsection (e) or (f), [ |
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approved as requested by the utility. | ||
(p) Except to implement a rate adjustment provision | ||
approved by the regulatory authority by rule or ordinance, as | ||
applicable, or to adjust the rates of a newly acquired utility | ||
system, a utility or two or more utilities under common control and | ||
ownership may not file a statement of intent to increase its rates | ||
for the same customer more than once in a 12-month period, unless | ||
the regulatory authority determines that a financial hardship | ||
exists. If the regulatory authority requires the utility to | ||
deliver a corrected statement of intent, the utility is not | ||
considered to be in violation of the 12-month filing requirement. | ||
SECTION 5. Subchapter F, Chapter 13, Water Code, is amended | ||
by adding Section 13.193 to read as follows: | ||
Sec. 13.193. UTILITY FACILITIES CONSTRUCTION AND | ||
IMPROVEMENT CHARGE. (a) Notwithstanding any other provision of | ||
this chapter, a utility may assess a utility facilities | ||
construction and improvement charge to recover the depreciation and | ||
return on investment of a utility facilities construction and | ||
improvement project that: | ||
(1) is completed and placed into service between two | ||
consecutive statements of intent to change the utility's rates or | ||
tariff filed under Section 13.187; and | ||
(2) serves the utility's certificated service area, | ||
including a facility used for: | ||
(A) the production, transmission, storage, | ||
distribution, or provision of potable or recycled water to the | ||
public; or | ||
(B) the collection, transportation, treatment, | ||
or disposal of sewage. | ||
(b) The commission by rule shall require a utility that | ||
proposes to assess a utility facilities construction and | ||
improvement charge under this section: | ||
(1) to file a tariff establishing a just and | ||
reasonable manner for calculating the charge; and | ||
(2) to receive the executive director's approval of | ||
the tariff. | ||
(c) In adopting rules under Subsection (b), the commission | ||
shall ensure that: | ||
(1) not later than the 60th day before a utility's | ||
proposed inclusion of a charge or a proposed increase of a charge in | ||
a tariff under this section, the utility submits to the executive | ||
director for review of a project's eligibility a written notice | ||
that contains: | ||
(A) the amount of the proposed charge or increase | ||
of a charge; | ||
(B) the proposed implementation date for the | ||
charge or increase of a charge; | ||
(C) a list of completed, eligible capital | ||
projects, and related depreciation and return on investment for | ||
which the utility seeks reimbursement through the charge or | ||
increase of a charge; and | ||
(D) a calculation of the projected total annual | ||
increase in revenue due to the charge or increase of a charge; | ||
(2) the total amount the utility is authorized to | ||
recover annually through a charge assessed under this section and | ||
the amount the utility actually recovers are subject to annual | ||
audit by the executive director; | ||
(3) the amount of the charge the utility requests | ||
authorization to assess is based on the amount necessary to ensure | ||
that the charge yields a rate of return on invested capital that is | ||
equal to: | ||
(A) the rate of return approved for the utility | ||
in the utility's most recent approved base rate or tariff change | ||
application filed under Section 13.187; or | ||
(B) the rate of return proposed by the utility, | ||
if the rates in the utility's most recent base rate or tariff change | ||
application were approved by settlement; | ||
(4) the cumulative annual amount the utility proposes | ||
to recover from the charge does not exceed an amount equal to 10 | ||
percent of the utility's annual revenue; | ||
(5) the utility does not implement an increase under | ||
this section more often than twice every calendar year; | ||
(6) the charge is applied to each customer included in | ||
the tariff; | ||
(7) the utility provides to each customer written | ||
notice of the charge on the initial tariff filing that proposes to | ||
implement the charge; and | ||
(8) the charge is subject to a true-up or | ||
reconciliation at the utility's next rate case filed under Section | ||
13.187. | ||
(d) Notwithstanding any other provision of this code, the | ||
implementation of a utility facilities construction and | ||
improvement charge or an increase in a utility facilities | ||
construction and improvement charge is not subject to a contested | ||
case hearing under Chapter 2001, Government Code. | ||
(e) A utility may not collect the charge after the first | ||
anniversary of the completion of a utility facilities construction | ||
and improvement project. | ||
(f) This section does not apply to a utility that has in | ||
place a negotiated stay-out agreement on September 1, 2011. | ||
SECTION 6. Section 13.242(c), Water Code, is amended to | ||
read as follows: | ||
(c) The commission may by rule allow a municipality or | ||
utility or water supply corporation to render retail water or sewer | ||
service without a certificate of public convenience and necessity | ||
if the municipality has given notice under Section 13.255 [ |
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area or if the utility or water supply corporation has less than 15 | ||
potential connections and is not within the certificated area of | ||
another retail public utility. | ||
SECTION 7. Section 13.248, Water Code, is amended to read as | ||
follows: | ||
Sec. 13.248. CONTRACTS VALID AND ENFORCEABLE. Contracts | ||
between retail public utilities designating areas to be served and | ||
customers to be served by those retail public utilities, when | ||
approved by the commission or the executive director after public | ||
notice [ |
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incorporated into the appropriate areas of public convenience and | ||
necessity. | ||
SECTION 8. Section 49.321, Water Code, is amended to read as | ||
follows: | ||
Sec. 49.321. DISSOLUTION AUTHORITY. After notice [ |
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district that is inactive for a period of five consecutive years and | ||
has no outstanding bonded indebtedness. | ||
SECTION 9. Section 49.324, Water Code, is amended to read as | ||
follows: | ||
Sec. 49.324. ORDER OF DISSOLUTION. The commission or the | ||
executive director may enter an order dissolving the district [ |
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director [ |
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functions for which it was created for a period of five consecutive | ||
years [ |
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no outstanding bonded indebtedness. | ||
SECTION 10. Section 49.326(a), Water Code, is amended to | ||
read as follows: | ||
(a) Appeals from an [ |
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district shall be filed and heard in the district court of any of | ||
the counties in which the land is located. | ||
SECTION 11. Section 54.030(b), Water Code, is amended to | ||
read as follows: | ||
(b) The governing body of a district which desires to | ||
convert into a district operating under this chapter shall adopt | ||
and enter in the minutes of the governing body a resolution | ||
declaring that in its judgment, conversion into a municipal utility | ||
district operating under this chapter and under Article XVI, | ||
Section 59, of the Texas Constitution, would serve the best | ||
interest of the district and would be a benefit to the land and | ||
property included in the district. The resolution shall also | ||
request that the commission approve [ |
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SECTION 12. Section 54.032, Water Code, is amended to read | ||
as follows: | ||
Sec. 54.032. CONVERSION OF DISTRICT: NOTICE. (a) Notice | ||
of the conversion [ |
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newspaper with general circulation in the county or counties in | ||
which the district is located. | ||
(b) The notice shall be published once a week for two | ||
consecutive weeks [ |
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(c) The notice shall: | ||
(1) [ |
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in full; and | ||
(2) [ |
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offer comments [ |
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proposal contained in the resolution. | ||
SECTION 13. Section 54.033, Water Code, is amended to read | ||
as follows: | ||
Sec. 54.033. CONVERSION OF DISTRICT; FINDINGS. (a) If | ||
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finds that conversion of the district into one operating under this | ||
chapter would serve the best interest of the district and would be a | ||
benefit to the land and property included in the district, the | ||
commission or executive director [ |
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this finding and the district shall become a district operating | ||
under this chapter and no confirmation election shall be required. | ||
(b) If the commission or the executive director finds that | ||
the conversion of the district would not serve the best interest of | ||
the district and would not be a benefit to the land and property | ||
included in the district, the commission or executive director [ |
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shall enter an order against conversion of the district into one | ||
operating under this chapter. | ||
(c) The findings of the commission or the executive director | ||
entered under this section shall be subject to appeal or review | ||
within 30 days after entry of the order [ |
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or denying the conversion. | ||
(d) A copy of the [ |
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shall be filed in the deed records of the county or counties in | ||
which the district is located. | ||
SECTION 14. The following are repealed: | ||
(1) Sections 13.187(d-1), (i), (j), (l), (m), and (n), | ||
Water Code; and | ||
(2) Sections 49.322 and 54.031, Water Code. | ||
SECTION 15. Except as otherwise provided by this Act, this | ||
Act applies only to a statement of intent filed on or after the | ||
effective date of this Act. A rate change to which a statement of | ||
intent filed before the effective date of this Act applies is | ||
governed by the law in effect on the date the statement was filed, | ||
and that law is continued in effect for that purpose. | ||
SECTION 16. This Act takes effect September 1, 2011. |