Bill Text: TX SB1188 | 2023-2024 | 88th Legislature | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Relating to receivership of the Agua Special Utility District and requirements for directors of the Agua Special Utility District.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Passed) 2023-06-18 - Effective on 9/1/23 [SB1188 Detail]
Download: Texas-2023-SB1188-Comm_Sub.html
Bill Title: Relating to receivership of the Agua Special Utility District and requirements for directors of the Agua Special Utility District.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Passed) 2023-06-18 - Effective on 9/1/23 [SB1188 Detail]
Download: Texas-2023-SB1188-Comm_Sub.html
By: Hinojosa | S.B. No. 1188 | |
(In the Senate - Filed February 24, 2023; March 9, 2023, | ||
read first time and referred to Committee on Local Government; | ||
April 6, 2023, reported adversely, with favorable Committee | ||
Substitute by the following vote: Yeas 7, Nays 0; April 6, 2023, | ||
sent to printer.) | ||
COMMITTEE SUBSTITUTE FOR S.B. No. 1188 | By: Nichols |
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relating to receivership of the Agua Special Utility District and | ||
requirements for candidates for the board of directors of the Agua | ||
Special Utility District. | ||
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: | ||
SECTION 1. Section 7201.055(b), Special District Local Laws | ||
Code, is amended to read as follows: | ||
(b) A candidate for a position on the board must: | ||
(1) reside in the subdistrict represented by that | ||
position; [ |
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(2) be eligible to hold office under Section 141.001, | ||
Election Code; | ||
(3) file a campaign treasurer appointment form | ||
described by Chapter 252, Election Code, with the Texas Ethics | ||
Commission; and | ||
(4) file each report required under Title 15, Election | ||
Code, with the Texas Ethics Commission and the board. | ||
SECTION 2. Section 7201.058, Special District Local Laws | ||
Code, is amended by amending Subsection (a) and adding Subsections | ||
(c), (d), and (e) to read as follows: | ||
(a) A director shall [ |
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majority of the other directors if the director: | ||
(1) does not have at the time of appointment the | ||
qualifications required by Section 7201.055(b) or is disqualified | ||
from serving under Section 7201.059; | ||
(2) does not complete the education program required | ||
by Section 7201.054; | ||
(3) does not meet the eligibility requirements under | ||
Section 7201.072; | ||
(4) fails to comply with Section 7201.071; [ |
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(5) misses one-half or more of the regularly scheduled | ||
meetings during the preceding 12 months; | ||
(6) repeatedly fails to file an affidavit under | ||
Section 553.002, Government Code, disclosing an interest in | ||
property to be acquired with public money; | ||
(7) repeatedly fails to file a conflicts disclosure | ||
statement under Section 176.003, Local Government Code; | ||
(8) fails to comply with Section 171.004, Local | ||
Government Code; | ||
(9) does not file the financial statement required of | ||
state officers under Section 7201.056; or | ||
(10) does not file a campaign treasurer appointment | ||
form or a required report under Section 7201.055. | ||
(c) A director shall be removed from the board by the other | ||
directors if the director has been convicted of or has pleaded | ||
guilty or nolo contendere to a civil or criminal offense of: | ||
(1) bribery; | ||
(2) embezzlement, extortion, or other theft of public | ||
money; | ||
(3) perjury; | ||
(4) coercion of a public servant or voter; | ||
(5) tampering with a governmental record; | ||
(6) misuse of official information; | ||
(7) abuse of official capacity; or | ||
(8) conspiracy to commit or an attempted commission of | ||
an offense described by Subdivisions (1)-(7). | ||
(d) The board shall begin the process of notice and public | ||
hearing for the removal of a director not later than the 30th day | ||
after the date the board receives notice of a violation under this | ||
section. On or before the 60th day after the date of the public | ||
hearing, the remaining directors shall make a determination on | ||
whether the violation occurred. | ||
(e) Not later than the 30th day after the date the board | ||
removes a director, the board shall begin the process of filling the | ||
vacancy in accordance with Section 49.105, Water Code. | ||
SECTION 3. Subchapter B, Chapter 7201, Special District | ||
Local Laws Code, is amended by adding Section 7201.059 to read as | ||
follows: | ||
Sec. 7201.059. DISQUALIFICATION OF DIRECTORS. A director | ||
is disqualified from serving as a director if: | ||
(1) the director is a member or is appointed or elected | ||
as a member of the governing body of another political subdivision; | ||
(2) the director does not: | ||
(A) meet the eligibility requirements under | ||
Section 7201.072; | ||
(B) file a campaign treasurer appointment form | ||
required under Section 7201.055(b)(3); or | ||
(C) file each report required under Section | ||
7201.055(b)(4); or | ||
(3) the board determines a relationship or employment | ||
exists to which Section 49.052, Water Code, applies. | ||
SECTION 4. Subchapter B-1, Chapter 7201, Special District | ||
Local Laws Code, is amended by adding Section 7201.075 to read as | ||
follows: | ||
Sec. 7201.075. PUBLIC ACCESS TO DIRECTOR REPORTS. (a) The | ||
district shall post to the district's Internet website and make | ||
publicly available each report required to be filed with the Texas | ||
Ethics Commission under Title 15, Election Code, by: | ||
(1) a director; | ||
(2) a candidate for the board; or | ||
(3) a specific-purpose committee responsible for | ||
supporting, opposing, or assisting a director or candidate for the | ||
board. | ||
(b) The district shall make available a report under | ||
Subsection (a) not later than the fifth business day after the date | ||
the report is filed with the board. | ||
(c) This section may not be construed to limit public access | ||
to information in a report described by Subsection (a) through | ||
other electronic or print distribution. | ||
(d) The district may remove the address of a person, except | ||
for the city, state, and zip code, listed as having made a political | ||
contribution to the member, candidate, or committee before posting | ||
a report on the district's Internet website. The information must | ||
remain available in a copy of the report maintained in the | ||
district's office. | ||
SECTION 5. Chapter 7201, Special District Local Laws Code, | ||
is amended by adding Subchapter E to read as follows: | ||
SUBCHAPTER E. RECEIVERSHIP OF DISTRICT; ENFORCEMENT | ||
Sec. 7201.301. DEFINITIONS. In this subchapter: | ||
(1) "Agent" means an individual who exercises | ||
discretion in the planning, recommending, selecting, or | ||
contracting of a vendor or contractor for the sale, lease, or | ||
purchase of real property, goods, or services on behalf of the | ||
district. | ||
(2) "Commission" means the Texas Commission on | ||
Environmental Quality. | ||
Sec. 7201.302. APPOINTMENT OF RECEIVER. (a) At the request | ||
of the commission, the attorney general shall bring an action for | ||
the appointment of a receiver to collect the assets and carry on the | ||
business of the district if the district: | ||
(1) received three consecutive audit reports with | ||
anything other than an unqualified or clean opinion; | ||
(2) completed five consecutive fiscal years at a net | ||
loss; | ||
(3) has defaulted on more than one financial debt | ||
obligation; | ||
(4) has a director or agent who has been convicted of | ||
or has pleaded guilty or nolo contendere to a civil or criminal | ||
offense related to the management or governance of the district; or | ||
(5) violates a final judgment issued by a district | ||
court in an action brought by the attorney general under: | ||
(A) this chapter; | ||
(B) Chapter 7, 13, 49, or 65, Water Code; | ||
(C) Chapter 341, Health and Safety Code; | ||
(D) laws governing the selection, monitoring, or | ||
review and evaluation of professional services, vendors, or | ||
contractors for construction or improvement projects; or | ||
(E) a rule adopted or order issued under any | ||
statute listed in this subdivision. | ||
(b) The court shall appoint a receiver if an appointment is | ||
necessary to: | ||
(1) guarantee the collection of assessments, fees, | ||
penalties, or interest; | ||
(2) guarantee continuous and adequate service to the | ||
customers of the district; or | ||
(3) prevent continued or repeated violations of a | ||
court order or final commission order. | ||
Sec. 7201.303. POWERS AND DUTIES OF RECEIVER. (a) The | ||
receiver shall execute a bond in an amount to be set by the court to | ||
ensure the proper performance of the receiver's duties. | ||
(b) After appointment and execution of bond, the receiver | ||
shall take possession of the assets of the district specified by the | ||
court. | ||
(c) Until discharged by the court, the receiver shall | ||
perform the duties that the court directs to preserve the assets and | ||
carry on the business of the district and shall strictly observe the | ||
final order involved. | ||
(d) The receiver has the powers and duties necessary to | ||
ensure the continued operation of the district and the provision of | ||
continuous and adequate services, including: | ||
(1) meter reading; | ||
(2) billing for services; | ||
(3) collecting revenue; | ||
(4) disbursing funds; | ||
(5) accessing all system components; and | ||
(6) requesting rate increases. | ||
Sec. 7201.304. DISSOLUTION OF RECEIVERSHIP. The court may | ||
dissolve the receivership and order the assets and control of the | ||
business returned to the district if the district shows good cause | ||
for the dissolution of the receivership. | ||
Sec. 7201.305. EFFECT ON COMMISSION ENFORCEMENT AUTHORITY. | ||
This section does not affect the authority of the commission to | ||
pursue an enforcement action against the district or an affiliated | ||
person. | ||
SECTION 6. Not later than the 30th day after the effective | ||
date of this Act, the board of directors of the Agua Special Utility | ||
District shall adopt or update procedures for the removal of a | ||
director under Section 7201.058, Special District Local Laws Code, | ||
as amended by this Act. | ||
SECTION 7. This Act takes effect September 1, 2023. | ||
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