85R9404 JXC-F     By: Nevárez H.B. No. 2369       A BILL TO BE ENTITLED   AN ACT   relating to municipal rates for water and sewer service charged to   public school districts.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  The legislature finds that the imposition of   fees for water service that are based on the number of students or   employees of a public school district diverts to other purposes   money appropriated in accordance with Section 1, Article VII, Texas   Constitution, for the education of students. For that reason, the   imposition of fees on those bases by a political subdivision   violates the Texas Constitution.          SECTION 2.  The heading to Section 13.044, Water Code, is   amended to read as follows:          Sec. 13.044.  RATES CHARGED BY MUNICIPALITY TO CERTAIN   SPECIAL DISTRICTS [DISTRICT].          SECTION 3.  Subchapter C, Chapter 13, Water Code, is amended   by adding Section 13.0441 to read as follows:          Sec. 13.0441.  RATES CHARGED BY MUNICIPALITY TO PUBLIC   SCHOOL DISTRICTS. (a) This section applies to rates charged by a   municipality for water or sewer service to a public school   district.          (b)  Notwithstanding the provisions of a resolution,   ordinance, or agreement, a public school district may appeal the   rates charged to the district by the municipality by filing a   petition with the utility commission. The utility commission shall   hear the appeal de novo, and the municipality shall have the burden   of proof to establish that the rates are just and reasonable. The   utility commission shall fix the rates to be charged by the   municipality in accordance with this chapter, including Section   13.088, and the municipality may not increase those rates without   the approval of the utility commission.          SECTION 4.  Subchapter D, Chapter 13, Water Code, is amended   by adding Section 13.088 to read as follows:          Sec. 13.088.  MUNICIPAL RATES FOR PUBLIC SCHOOL DISTRICTS.   (a) A municipally owned utility that provides retail water or sewer   utility service to a public school district shall charge the   district for that service the lowest rates the utility charges   commercial businesses or nonprofit organizations that receive   retail water or sewer utility service from the utility.          (b)  A municipally owned utility that provides retail water   or sewer utility service to a public school district may not charge   the district:                 (1)  a fee that the utility does not charge commercial   businesses that receive retail water or sewer utility service from   the utility; or                (2)  a fee based on the number of district students or   employees.          SECTION 5.  (a)  This section applies only to a public   school district that, after August 1, 2012, was charged a rate or   fee for retail water or sewer utility service based on the number of   district students or employees.          (b)  Notwithstanding any other law or agreement, on the   petition of a public school district, the Public Utility Commission   of Texas shall evaluate a rate or fee for retail water or sewer   utility service charged by a municipally owned utility to the   district after August 1, 2012, to determine whether the rate or fee   complies with Chapter 13, Water Code, as amended by this Act.          (c)  If the Public Utility Commission of Texas determines   under Subsection (b) of this section that the rate or fee does not   comply with Chapter 13, Water Code, as amended by this Act, the   commission:                (1)  shall fix the rate or fee to be charged by the   municipally owned utility in accordance with Chapter 13, Water   Code, as amended by this Act;                (2)  shall establish the original effective date of the   rate or fee that does not comply with Chapter 13, Water Code, as   amended by this Act, based on information submitted by the   municipally owned utility;                (3)  shall by order require the municipally owned   utility to refund to the public school district money collected   from the rate or fee described by Subdivision (2) of this subsection   in excess of the rate or fee fixed under Subdivision (1) of this   subsection; and                (4)  may allow the public school district to recover   from the municipally owned utility any reasonable expenses incurred   by the district in the process of submitting a petition under this   section.          (d)  This section expires and a public school district may   not submit a petition under this section after September 1, 2022.          SECTION 6.  This Act takes effect immediately if it receives   a vote of two-thirds of all the members elected to each house, as   provided by Section 39, Article III, Texas Constitution.  If this   Act does not receive the vote necessary for immediate effect, this   Act takes effect September 1, 2017.