85R20897 JXC-F
	By: Larson, Workman	H.B. No. 3987

	A BILL TO BE ENTITLED
	AN ACT
	relating to the authority of the Texas Water Development Board to
	use the state participation account of the water development fund
	to provide financial assistance for the development of certain
	facilities.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  This Act may be cited as the Texas State Water
	Investment Fund Act.
	SECTION 2.  The heading to Section 16.131, Water Code, is
	amended to read as follows:
	Sec. 16.131.  AUTHORIZED PROJECTS FOR STATE PARTICIPATION
	ACCOUNT.
	SECTION 3.  Subchapter E, Chapter 16, Water Code, is amended
	by adding Section 16.145 to read as follows:
	Sec. 16.145.  AUTHORIZED PROJECTS FOR STATE PARTICIPATION
	ACCOUNT II. (a) The board may use the state participation account
	II created under Section 17.957 to provide financial assistance for
	the development of a desalination or aquifer storage and recovery
	facility, including associated intake or distribution facilities,
	to meet existing or projected future water needs by acquiring such a
	facility or an ownership interest in such a facility.
	(b)  The board may act singly or in a joint venture in
	partnership with any person, including a public or private entity,
	an agency or political subdivision of this state, another state or a
	political subdivision of another state, the United States, or a
	foreign nation, to the extent permitted by law. The board may
	provide financial assistance under this section for a facility
	without regard to any requirements provided by board rules
	regarding the portion of the capacity of the facility that will
	serve an existing need or the portion of the cost of the facility
	that the applicant will finance from sources other than the state
	participation account II.
	(c)  Section 16.135 does not apply to the use of the state
	participation account II to develop a facility described by
	Subsection (a) by acquiring the facility or an interest in the
	facility.
	(d)  Before the board may acquire a facility or an interest
	in a facility described by Subsection (a), the board must find
	affirmatively that:
	(1)  it is reasonable to expect that the state will
	recover its investment in the facility; and
	(2)  the public interest will be served by the
	acquisition of the facility.
	(e)  The board may not provide financial assistance under
	this section for a facility unless the facility is included in the
	state water plan.
	(f)  The board shall establish a point system for
	prioritizing facilities for which financial assistance is sought
	from the board under this section. The system must include a
	standard for the board to apply in determining whether a facility
	qualifies for financial assistance at the time the application for
	financial assistance is filed with the board.
	(g)  The board may not issue more than $200 million in water
	financial assistance bonds designated by the board as issued to
	provide financial assistance for facilities under this section.
	(h)  If the board does not provide financial assistance for a
	facility from the state participation account II before September
	1, 2022, the board may not provide financial assistance for any
	facility from that account after that date.
	SECTION 4.  Section 16.182, Water Code, is amended to read as
	follows:
	Sec. 16.182.  PERMITS [PERMIT] REQUIRED. (a) Before the
	board grants the application to buy, receive, or lease the
	facilities, the applicant shall first secure all appropriate
	permits [a permit for water use] from the commission. If the
	facilities are to be leased, a [the] permit may be for a term of
	years.
	(b)  The board may assist the applicant with securing permits
	for a facility described by Section 16.145.
	SECTION 5.  Section 17.957, Water Code, is amended by
	amending Subsections (b) and (c) and adding Subsection (c-1) to
	read as follows:
	(b)  The state participation account is composed of:
	(1)  money and assets attributable to water financial
	assistance bonds designated by the board as issued for projects
	described in Sections [Section] 16.131 and 16.145;
	(2)  money from the sale, transfer, or lease of a
	project described in Subdivision (1) that was acquired,
	constructed, reconstructed, developed, or enlarged with money from
	the state participation account;
	(3)  payments received under a bond enhancement
	agreement with respect to water financial assistance bonds
	designated by the board as issued for projects described in
	Sections [Section] 16.131 and 16.145;
	(4)  investment income earned on money on deposit in
	the state participation account;
	(5)  money disbursed to the fund from the state water
	implementation fund for Texas as authorized by Section 15.434; and
	(6)  any other funds, regardless of their source, that
	the board directs be deposited to the credit of the state
	participation account.
	(c)  Money on deposit in the state participation account may
	be used by the board for projects described in Sections [Section]
	16.131 and 16.145 in the manner that the board determines necessary
	for the administration of the fund.
	(c-1)  The comptroller shall establish a subaccount in the
	state participation account to be known as the state participation
	account II. The board may credit to the subaccount money in the
	state participation account allocated by the board for the purposes
	of Section 16.145. The board may transfer money from the subaccount
	to the state participation account if the board determines the
	money is needed for the purposes of Section 16.131.
	SECTION 6.  This Act takes effect September 1, 2017.