Office of House Bill AnalysisH.B. 3299
By: Walker
Natural Resources


Texas faces a difficult challenge in developing water policies that serve
both state and regional interests. The Texas Constitution authorizes the
creation of various types of districts to plan, develop, and regulate the
use of water for the public health, safety, and welfare.  Amendments to the
Water Code may facilitate more efficient operation of those districts.
House Bill 3299 amends provisions regarding general law districts, water
control and improvement districts, municipal utility districts, fresh water
supply districts, and levee improvement districts.   


It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 


House Bill 3299 amends the Water and Local Government codes relating to the
general powers and authority of water districts.  The bill amends the Water
Code to increase, from $100 to $150, the amount to which a director of a
general law district (district) is entitled to for daily performance of
duties (Sec. 49.060).  A district, at a confirmation and director election
is authorized to submit to the qualified district voters the proposition of
entering into and implementing a fire department operation plan (Sec.
49.102). A district's authorization to issue bonds remains in effect after
the election unless the district is dissolved or annexed by another
district (Sec. 49.106).   

Provisions regarding the submission of an appraisal roll to a governing
body, effective and rollback tax rates, tax rate, and election to repeal a
tax increase exceeding the rollback tax rate do not apply to a tax levied
and collected for payment of the interest on and principal bonds issued by
a district or made under certain contracts (Secs. 49.107 and 49.108).  The
bill specifies that the board of directors (board) of a district is
authorized to allow, by resolution, wire transfers.  If the wire transfer
is to an account not in the name of the district, the wire transfer
instructions must be signed by at least a majority of the directors (Sec.
49.151).  The bill removes the provision preventing the district from
paying interest during construction out of available district funds not to
exceed three years after acceptance of the project (Sec. 49.155).        

In any proceeding concerning the validity of the creation of a district or
the annexation of property by a district, a certificate of ownership as
certified by the central appraisal district of the county or counties in
which the property is located creates a presumption of ownership.  On
request by a district, the central appraisal district of the county or
counties in which the district is located is required to furnish
certificates of ownership and is authorized to charge reasonable recovery
fees (Sec. 49.184).  The bill sets forth exceptions to the applicability of
provisions regarding governmental action affecting private property rights
(Sec. 49.212).  A district or water supply corporation is authorized to
require a service applicant and a developer to grant a permanent recorded
easement and to issue bonds, notes, or other obligations to acquire
property which is not subject to assessments, charges, fees, or dues
imposed by a nonprofit organization (Sec. 49.218).   

 The bill authorizes the district to provide for a sanitary sewer system
and to require property owners to  connect to the sewer system (Sec.
49.234).  The bill provides that the payment, performance, and bid bonding
requirements do not apply to a contract for the purchase of equipment,
materials, or machinery (equipment) not otherwise incorporated into a
construction project (Sec. 49.271).  If changes in plans or specifications
are necessary after the performance of a construction or equipment contract
is begun, the board is authorized to approve orders making the changes.
The aggregate of the change orders is prohibited from increasing the
original contract price by more than 10 percent.  The bill provides that
the board is not required to advertise or seek competitive bids for the
repair of district facilities if the extent of the repair cannot be readily
ascertained or does not lend itself to competitive bidding, rather than if
the cost of repair is less than or equal to advertising requirements (Sec.

The bill sets forth provisions regarding the determination of a district's
prevailing wage rate (Sec. 49.279). The bill authorizes a district to add
or exclude land after a district is created and before a confirmation
election is held (Sec. 49.315).  Provisions regarding unclaimed property do
not apply  to any personal property held by a district that has not been
dissolved by order of the Texas Natural Resource Conservation Commission
(TNRCC) (Sec. 49.327).  The bill updates provisions relating to the
authority of the district's operation and maintenance of fire departments
regarding the issuance of bonds, the imposition of mandatory fees, the
purchase of land, employment contracts, an operation plan, public hearings
and posting, and voluntary contributions (Sec. 49.351). 

The bill authorizes a district to acquire recreational facilities and
obtain funds to develop and maintain them and to charge fees directly to
the users of recreational facilities and to water and wastewater customers
of the district for such purposes.  A district is prohibited from issuing
bonds supported by ad valorem taxes to pay for the development and
maintenance of recreational facilities (Secs. 49.461-49.464).  The bill
requires the board, by rule, to establish standards for the development and
maintenance of recreational facilities and for the allocation of a
district's funds for such (Sec. 49.465).   

The bill authorizes a water control and improvement district to adopt and
enforce reasonable rules and regulations to further the water control and
improvement district's purpose (Sec. 51.122).  The bill provides that a
person who violates a regulation adopted by a water control and improvement
district commits a Class C misdemeanor (Sec. 51. 221).   

The bill removes the provision providing that the tax assessor and
collector is elected with the supervisors of the fresh water supply
district board (Sec. 53.021).  The bill repeals provisions regarding the
ballot for election relating to fresh water supply districts  (Sec.

The bill specifies that a municipal utility district (MUD) is authorized to
purchase and install street or security lighting within public utility
easements or public rights-of-way within the MUD's boundaries.  The bill
removes the provision providing that such street or security lighting
facilities must have been constructed by an owner or developer of property
within such a MUD and must have been required by a city as a condition to
the city granting its consent to the creation of the MUD.  The bill also
specifies that such a MUD is prohibited from issuing bonds supported by ad
valorem taxes to pay for the purchase, installation, and maintenance of
street security or lighting (Sec. 54.236).  The bill adds landscaping,
parkways, greenbelts, sidewalks, trails, public right-of-way beautification
projects, and associated street and security lighting to the definition of
"recreational facilities" in regard to MUDs (Sec. 54.772).  The bill
specifies that a MUD is prohibited from issuing bonds supported by ad
valorem taxes to pay for the development and maintenance of recreational
facilities (Sec. 54.774).   

The bill also specifies that a levee improvement district is authorized to
adopt and enforce rules and regulations to further the district's purpose
(Secs. 57.092 and 57.093).  A municipality, without an election, is
authorized to sell to a water district, a water or sewer system owned by
the municipality (Sec. 402.908).     

On passage, or if the Act does not receive the necessary vote, the Act
takes effect September 1, 2001.