CHAPTER 7208. PARKER COUNTY UTILITY DISTRICT NO. 1 - Texas Statutes

SPECIAL DISTRICT LOCAL LAWS CODE

TITLE 6. WATER AND WASTEWATER

SUBTITLE C. SPECIAL UTILITY DISTRICTS

CHAPTER 7208. PARKER COUNTY UTILITY DISTRICT NO. 1

SUBCHAPTER A. GENERAL PROVISIONS

Sec. 7208.001. DEFINITIONS. In this chapter:

(1) "Board" means the board of directors of the district.

(2) "Bond" means any interest-bearing obligation, including a

bond, note, debenture, certificate, warrant, security, interim

certificate or receipt, or other evidence of debt issued by the

district, whether general or special, negotiable or nonnegotiable

in form, in bearer or registered form, temporary or permanent in

form, or with or without interest coupons.

(3) "Customer" means a wholesale or direct retail user of water,

wastewater, or other services provided by the district.

(4) "Director" means a member of the board.

(5) "District" means the Parker County Utility District No. 1.

(5-a) "Enterprise fund" means a fund used to account for

operations:

(A) that are financed and operated in a manner similar to a

private business enterprise and for which the intent of the board

is that the costs, including depreciation, of providing goods or

services to the public on a continuing basis be financed or

recovered primarily through user charges; or

(B) for which the board has decided that periodic determination

of revenues earned, expenses incurred, or net income earned is

appropriate for capital maintenance, public policy, management

control, accountability, or other purposes.

(6) "Local government" means a municipality, a county, or an

entity created under Section 52, Article III, or Section 59,

Article XVI, Texas Constitution.

(7) "Member entity" means a public entity or private utility

entity that:

(A) provides retail utility service or regulates water,

wastewater, sewage, or solid waste in the district; and

(B) enters into a contract with the district to provide or

receive wholesale service.

(7-a) "Operating unit" means a separately run unit established

by action of the board that runs as an enterprise fund separate

from other enterprise funds owned or operated by the district.

(8) "Participant entity" means a public entity or private

utility entity that:

(A) provides utility service inside the boundaries of the

entity; and

(B) contracts with the district for the construction of and

payment for water, wastewater, or other utility service projects

to be financed or provided by the district.

(8-a) "Retail unit" means any unit in which the district

provides retail service for a given certificate of public

convenience and necessity or bounded service area. Each retail

unit shall be considered an operating unit.

(9) "Service area" means the territory inside the district and

inside the corporate limits or defined boundaries of all member

entities, participant entities, and customers of the district,

including the areas served by the member entities, participant

entities, and customers.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 1, eff. June 19, 2009.

Sec. 7208.002. NATURE OF DISTRICT. The district is a regional

wastewater district created under Section 59, Article XVI, Texas

Constitution, and is essential to accomplish the purposes of that

provision.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.003. PURPOSE. The district is created to:

(1) purchase, own, hold, lease, or otherwise acquire water

distribution facilities, wastewater collection facilities, or

other facilities required to facilitate the district's

operations;

(2) build, operate, and maintain facilities to treat, transport,

and store water, wastewater, or other products necessary for

district operations;

(3) protect, preserve, and restore the purity and sanitary

condition of water in the district; and

(4) provide other utilities in the district if the utilities are

not otherwise provided.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 2, eff. June 19, 2009.

Sec. 7208.004. FINDINGS OF BENEFIT AND PUBLIC PURPOSE. (a) All

land and other property included in the district will benefit

from the improvements, works, and projects that are to be

accomplished by the district under the powers conferred by this

chapter and Section 59, Article XVI, Texas Constitution.

(b) The district benefits the state by:

(1) contributing to economic development and diversification;

(2) decreasing the rates of unemployment and underemployment;

(3) stimulating agricultural innovation;

(4) fostering enterprise growth based on agriculture; and

(5) contributing to the development or expansion of

transportation and commerce.

(c) The accomplishment of the purposes of the district benefits

the people, property, and industry of the state. The district is

performing an essential public function under the Texas

Constitution by accomplishing the purposes of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.005. DISTRICT TERRITORY. (a) The district is

composed of the territory described by Section 1.04, Chapter

1273, Acts of the 75th Legislature, Regular Session, 1997, as

that territory may have been modified under:

(1) Subchapter B or its predecessor statutes, Sections 2.17 and

6.01, Chapter 1273, Acts of the 75th Legislature, Regular

Session, 1997;

(2) Subchapter J, Chapter 49, Water Code;

(3) Subchapter H, Chapter 54, Water Code;

(4) Subchapter H, Chapter 65, Water Code; or

(5) other law.

(b) The boundaries and field notes of the district form a

closure. A mistake in the field notes or in copying the field

notes in the legislative process does not affect:

(1) the district's organization, existence, or validity; or

(2) the legality or operation of the district or its board.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.006. EXISTING OBLIGATIONS AND RIGHTS OF OTHER ENTITIES

PRESERVED. This chapter does not alter any existing permit,

contract, or other obligation or impair the right of any entity

to own, operate, maintain, or otherwise use, provide, or control

water, wastewater, solid waste, or liquid waste under the

entity's governing law.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

SUBCHAPTER B. ADDING TERRITORY OR NEW MEMBER ENTITIES

Sec. 7208.051. ADDING TERRITORY OF MEMBER ENTITIES. On request

by a member entity, the district boundaries may be expanded to

include additional or the remaining territory of the member

entity if:

(1) the boundaries of the member entity are contiguous to the

district boundaries; and

(2) the requested expansion is approved by a three-fourths

majority vote of the board.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.052. ADDING NEW MEMBER ENTITIES. (a) On receipt of a

petition submitted by the governing body of a local government,

another political subdivision, or a private entity, including a

water supply corporation, the board may add a member entity to

the district as provided by this section.

(b) A petition must be submitted in the manner and form required

by the district bylaws.

(c) On receipt of a petition, the board shall give notice and

hold a hearing on the petition to determine if adding the member

entity to the district:

(1) will benefit the territory or service area in the member

entity; and

(2) is in the best interests of the district.

(d) If the board determines that the proposed member entity

should be added to the district, the board shall issue an order:

(1) adding the proposed member entity and its territory or

service area to the district;

(2) making the member entity and its territory or service area

subject to the privileges, duties, assets, and financial

obligations of the district in the same manner as other member

entities; and

(3) requiring the member entity to reimburse the existing member

entities or directly reimburse the district an amount that is an

equitable pro rata share of the costs paid by the existing member

entities or the district in creating and operating the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.053. APPOINTMENT OF DIRECTORS BY NEW MEMBER ENTITY.

If the board issues an order under Section 7208.052(d) adding a

member entity to the district, the governing body of the member

entity shall appoint the appropriate number of directors to the

board as provided by Section 7208.103.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

SUBCHAPTER C. BOARD OF DIRECTORS

Sec. 7208.101. GOVERNING BODY. The district is governed by a

board of directors. The board has exclusive authority to manage

the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.102. TERMS. Directors serve staggered four-year terms

beginning May 1 of the year in which the director is appointed.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.103. APPOINTMENT OF DIRECTORS. (a) Not earlier than

April 1 or later than April 30 of each year, the appropriate

number of directors, if any, shall be appointed to the board as

provided by Subsection (b).

(b) Each member entity shall appoint:

(1) one director if the number of member entities is at least

six;

(2) two directors if the number of member entities is at least

three but less than six;

(3) three directors if there are two member entities; or

(4) six directors if there is one member entity.

(c) A participant entity or customer may not appoint a director.

(d) The appointment of a director is not valid unless the

appointment is made as provided by this subchapter.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.104. QUALIFICATIONS FOR OFFICE. A person is qualified

to serve as a director if the person:

(1) is at least 18 years of age;

(2) is a qualified voter who resides in the district;

(3) qualifies to serve as a director by taking the oath of

office;

(4) is eligible to serve as a director under Subchapter C,

Chapter 49, Water Code, except as otherwise provided by this

section; and

(5) verifies compliance with the requirements of this section.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.105. EX OFFICIO DIRECTORS. (a) The county judge of

Parker County, or a person designated by that judge, serves as an

ex officio director. An ex officio director may vote on any

matter considered by the board.

(b) The board may appoint or elect other ex officio directors

and provide for the powers and duties of ex officio directors in

the bylaws or rules of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.106. VACANCY. (a) Any time after a board vacancy

occurs, the governing body of the appropriate member entity shall

fill the vacancy by appointment.

(b) The member entity shall provide notice of the appointment to

the board not later than six hours before the first board meeting

following the appointment.

(c) The appointment is effective on the date notice is received

by the board. If the notice is not provided, the appointment is

not effective until after the first board meeting following the

appointment.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.107. REMOVAL FROM OFFICE. A director may be removed

for any reason:

(1) by the governing body of the member entity that appointed

the director; or

(2) if three-fourths of the directors vote to remove the

director.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.108. COMPENSATION; EXPENSES. (a) Except as provided

by Subsection (b), a director may not receive compensation for

serving on the board.

(b) A director may receive reimbursement for travel or other

expenses reasonably incurred by the director while acting on

behalf of the district. The board may adopt reasonable policies

governing the reimbursement of director expenses, including a

requirement that the director provide written verification of

expenses.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.109. OFFICERS. (a) Each year at the first board

meeting following the appointment of directors under Section

7208.103, the board shall elect from its members a president, a

vice president, a secretary, a treasurer, and any other officer

the board determines is necessary.

(b) The president is the chief executive officer of the

district.

(c) The vice president may perform the duties and exercise the

powers of the president if the president is absent or fails,

refuses, or is unable to act.

(d) The board secretary or an assistant secretary:

(1) shall keep a record of the minutes of board meetings;

(2) shall maintain the official district records; and

(3) may certify the accuracy and authenticity of any actions,

proceedings, minutes, or records of the board or the district.

(e) The board may provide for additional powers and duties of

elected officers in the district bylaws.

(f) Officers serve until the election of new officers.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.110. MEETINGS. The board shall hold regular and, if

necessary, special and emergency board meetings. The board shall

hold board meetings at a time and place specified in the district

bylaws.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.111. QUORUM. (a) A quorum of the directors is

required to be present at a board meeting for the board to

conduct district business.

(b) The board shall specify in the district bylaws the number of

directors that constitute a quorum. A quorum may not be less

than a majority of the directors serving on the board.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.112. VOTING REQUIREMENTS. (a) The board shall

specify in the district bylaws the number of votes necessary to

approve a matter considered by the board. The number of votes

specified may not be less than a majority of the directors

present at the meeting at which the matter is being considered.

(b) A director, including the president, may vote on any matter

considered by the board, including a matter authorizing a

financial commitment to a capital project. This subsection

applies even if the director was appointed by a member entity

that is not participating in the project being considered by the

board.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.113. CONFLICT OF INTEREST. District directors and

officers are subject to Chapter 572, Government Code.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.114. DISTRICT EMPLOYEES. The board may appoint and

employ any person that the board determines is necessary to

conduct the affairs of the district, including a general manager,

engineer, attorney, financial advisor, accountant, or other

consultant.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.115. BYLAWS. The board shall adopt bylaws to govern

matters of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.116. CUSTOMER ADVISORY COUNCILS. (a) For each

operating unit, the board may establish a customer advisory

council that consists of one representative of each wholesale

customer or retail unit of the district.

(b) For each retail unit, the board may establish a customer

advisory council that consists of five members appointed by the

retail customers of the unit in accordance with the laws

applicable to and rules of the district. An advisory council

member must reside in the service area of the retail unit.

(c) A representative serving on a customer advisory council:

(1) has the powers and duties provided in the bylaws and rules

of the district; and

(2) may not vote on any matter considered by the board.

(d) The board may abolish a customer advisory council.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 3, eff. June 19, 2009.

SUBCHAPTER D. POWERS AND DUTIES

Sec. 7208.151. GENERAL POWERS AND DUTIES OF DISTRICT. Except as

provided by Sections 7208.167 and 7208.206, the district has all

the rights, powers, privileges, functions, and duties:

(1) provided by general law, including Chapters 49, 54, and 65,

Water Code; and

(2) conferred by Section 59, Article XVI, Texas Constitution.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.152. RULES. The board may adopt and enforce

reasonable rules to exercise the powers and perform the duties of

the district as provided by this chapter.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.153. RULES RELATING TO WATER QUALITY. (a) The

district may adopt and enforce rules relating to protection of

the quality of water flowing to or from the areas in or

surrounding a lake, reservoir, or other source of water supply

owned, operated, or controlled by the district.

(b) A rule adopted by the district under this section must:

(1) relate to:

(A) preventing waste or unauthorized use of water controlled by

the district; or

(B) regulating privileges on land, a reservoir, or an easement

owned or controlled by the district; and

(2) be consistent with rules of the state.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.154. GENERAL WASTE AND WATER POWERS. The district

may:

(1) provide for:

(A) the collection, construction, improvement, maintenance, and

operation of wholesale or retail wastewater and water systems and

treatment works necessary to provide wholesale or retail service

to customers; and

(B) the acquisition, construction, improvement, and maintenance

of a water supply or reservoir, or an interest in a water supply

or reservoir, necessary to exercise and fulfill the powers and

duties of the district;

(2) supply water for municipal, domestic, and industrial or

other beneficial uses or controls;

(3) collect, treat, process, dispose of, and control all

domestic or industrial wastes, whether in fluid, solid, or

composite state;

(4) gather, conduct, divert, control, and treat local storm

water or local harmful excesses of water in the district; and

(5) irrigate and alter land elevations in the district as

needed.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 4, eff. June 19, 2009.

Sec. 7208.155. PERMITS. The district may acquire a water

appropriation or other necessary permit from the state or a

permit owner.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.156. GENERAL CONTRACTING AUTHORITY. (a) If necessary

to exercise the powers and accomplish the purposes of the

district, the district may contract with the United States, a

municipality, a county, a water supply corporation, an entity

created under Section 52, Article III, or Section 59, Article

XVI, Texas Constitution, or another public or private entity.

(b) The district may contract for the acquisition, rental,

lease, or operation of wastewater or water facilities owned or

operated by the party contracting with the district.

(c) A contract that requires payment of money by the district

may be satisfied from any general or specific source of district

money as determined by the board.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.157. CONTRACTS WITH DISTRICT FOR WATER, WASTEWATER,

AND OTHER UTILITY SERVICES. (a) Except as provided by

Subsection (b), this chapter does not require a customer or

prospective customer of the district to secure water, wastewater,

or other utility service from the district unless the customer or

prospective customer contracts with the district for that

purpose.

(b) A customer or prospective customer is required to secure

water, wastewater, or other utility service from the district if:

(1) the customer or prospective customer is not receiving the

service from another source; and

(2) the district provides the service or determines that the

district will make the service available to the customer or

prospective customer.

(c) If a customer contracts with the district to secure water,

wastewater, or other utility service from the district, a user of

the service under the contract must connect to the district's

service system if:

(1) the user is located inside the boundaries of the customer;

and

(2) the district's system is available for connection at or near

the property line of the user.

(d) A contract under this section may authorize the district to:

(1) require the customer to terminate service provided to a user

who fails or refuses to pay for that service after providing

notice as required by law;

(2) terminate service provided to a customer or user who fails

or refuses to pay for that service after providing notice as

required by law; and

(3) terminate other utility services provided to a customer or

user if the customer or user fails or refuses to pay for any

service provided by the district after providing notice as

required by law.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 5, eff. June 19, 2009.

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 6, eff. June 19, 2009.

Sec. 7208.158. AUTHORITY OF OTHER ENTITIES TO CONTRACT WITH

DISTRICT. (a) A municipality, county, public agency, or

political subdivision of the state, an entity created under

Section 52, Article III, or Section 59, Article XVI, Texas

Constitution, or a water supply corporation may contract with the

district if the entity is conducting business wholly or partly

inside the district.

(b) The governing body of an entity that contracts with the

district under this section may pledge to the payment of the

contract any source of revenue available to the governing body,

including revenue from ad valorem taxes.

(c) If an entity under this section pledges to the payment of a

contract money from the entity's water system, wastewater system,

or combined water and wastewater system, the payments are an

operating expense of that system.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.159. JOINT AGREEMENTS. To accomplish the objectives

and exercise the powers of the district, the district may enter

into a joint agreement or contract with a water supply

corporation, a municipality, an entity created under Section 52,

Article III, or Section 59, Article XVI, Texas Constitution, a

county, a political subdivision of the state, the state, or

another private or public entity.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.160. WASTEWATER AND OTHER NECESSARY UTILITIES AND

SERVICES. (a) The district may provide wastewater collection,

treatment, or service in the district.

(b) The district may own, operate, and provide other necessary

utilities and services in the district, including raw water,

potable water, water distribution and treatment, solid waste

collection and disposal, fire, police, and ambulance services,

if:

(1) the right to own, operate, or provide the utility or service

has not been conveyed to another entity; or

(2) the entity to which the right has been conveyed agrees to

sell, cede, or otherwise convey to the district the right to own,

operate, or provide the utility or service.

(c) Subsection (b) does not require the district to own,

operate, or provide other necessary utilities or services in the

district unless the district is required to own, operate, or

provide the utility or service under a permit, certificate, or

license issued by the state.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.161. CONSTRUCTION OR ACQUISITION OF WORKS AND

FACILITIES. The district may plan, lay out, construct, acquire,

own, operate, maintain, repair, improve, or contract for, inside

or outside the district, any works, improvements, facilities,

plants, equipment, and appliances, including any administrative

property and facilities, any permits, franchises, licenses, or

contract or property rights, and any levees, drains, waterways,

lakes, reservoirs, channels, conduits, sewers, dams, storm water

detention facilities, treatment plants, or other similar

facilities and improvements, whether for municipal, industrial,

agricultural, flood control, or related purposes, that are

necessary, helpful, or incidental to the exercise of any right,

power, privilege, or function provided by this chapter.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.162. WASTE DISPOSAL SYSTEMS. (a) The district may

establish, acquire, operate, or maintain a regional solid waste

disposal system or a nonhazardous liquid waste disposal system.

(b) If the district establishes a disposal system under this

section, the district shall provide services from the system to:

(1) users as determined by the board if the services are

provided inside the district's service area; and

(2) customers if the services are provided outside the

district's service area.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.163. SERVICES PROVIDED OUTSIDE SERVICE AREA. The

district may provide services outside the district's service

area as provided by state law.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.164. RIGHT OF EMINENT DOMAIN. (a) The district may

acquire by eminent domain land, an easement, a right-of-way, or

other property or improvement inside or outside the district if

necessary or appropriate in exercising the powers and performing

the functions of the district.

(b) The district may exercise the power of eminent domain as

provided by state law, including Chapter 21, Property Code,

except that the district is not required to comply with Section

21.021(a), Property Code, during the pendency of the subject

litigation.

(c) In a condemnation proceeding brought by the district, the

district is not required to:

(1) pay in advance or give bond or other security for costs;

(2) give bond for the issuance of a temporary restraining order

or a temporary injunction; or

(3) give bond for costs or supersedeas on an appeal or writ of

error.

(d) The district may not exercise the power of eminent domain to

acquire:

(1) property located in the existing corporate limits of a

municipality that is located wholly or partly inside the district

unless the governing body of the municipality in which the

property is located consents by resolution to the acquisition of

the property;

(2) property located outside the district to be used as a water

supply reservoir unless the county in which the reservoir is to

be located consents;

(3) property owned by a county, a municipality, an entity

created by special act of the legislature under Section 52,

Article III, or Section 59, Article XVI, Texas Constitution, a

political subdivision of the state, or an agency or

instrumentality of a county or municipality; or

(4) a waterworks system or a wastewater system owned by a

municipality, an entity created by special act of the legislature

under Section 52, Article III, or Section 59, Article XVI, Texas

Constitution, a political subdivision of the state, a private

party, or a nonprofit corporation.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.165. COSTS OF RELOCATING OR ALTERING PROPERTY. If the

district exercises the power of eminent domain and requires

relocating, raising, lowering, rerouting, changing the grade of,

or altering the construction of any railroad, highway, pipeline,

or electric transmission and electric distribution, telegraph, or

telephone lines, conduits, poles, or facilities, the district

shall pay the cost of relocating, raising, lowering, rerouting,

changing the grade, or altering the construction that equals the

comparable replacement cost without enhancement of facilities

minus the net salvage value derived from the old facility.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.166. REGULATORY POWER OF MUNICIPALITIES. The district

and the land in the district are subject to any ordinance, code,

resolution, or rule, including any platting or zoning

requirement, of a municipality that has jurisdiction over

territory in the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.167. STATE SUPERVISION. (a) The rights, powers,

privileges, functions, and duties of the district are subject to

the continuing right of supervision by this state exercised by

the Texas Commission on Environmental Quality.

(b) Except as otherwise provided by this chapter or other law,

the district may exercise the rights, powers, privileges,

functions, and duties conferred by this chapter without obtaining

approval from the Texas Commission on Environmental Quality.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.168. RIGHTS AND DUTIES ASSUMED ON CREATION OF

DISTRICT. The district may succeed to and assume the rights,

privileges, and duties, including contractual obligations, of the

Walnut Creek Special Utility District and the City of Springtown

relating to the creation of the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

SUBCHAPTER E. GENERAL FINANCIAL PROVISIONS

Sec. 7208.201. AUDITS. All funds and accounts of the district

shall be audited annually by an independent auditor. The

district shall maintain a copy of the audit in the district's

official records.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Amended by:

Acts 2009, 81st Leg., R.S., Ch.

1201, Sec. 7, eff. June 19, 2009.

Sec. 7208.202. DEPOSITORY. The board, by order or resolution,

shall designate one or more banks inside or outside the district

to serve as depository for district money. Except as provided by

this chapter, district money shall be deposited in a depository

bank designated under this section.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.203. INVESTMENT OF DISTRICT MONEY. The board may

invest district money:

(1) in the same manner as provided for the investment of county

money; and

(2) as provided by Chapter 2256, Government Code.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.204. RATES, FEES, CHARGES, AND RENTALS. (a) District

rates, fees, and charges assessed to provide services and

facilities to customers and users of the district may vary

according to customer class, project, or service area to reflect

different costs of providing service.

(b) The district may require a customer to obtain a deposit from

a user for services or facilities provided by the district. A

deposit under this subsection may bear interest.

(c) If the district issues bonds payable wholly from revenue,

the board shall establish and revise rates of compensation for

water sold and wastewater or other services rendered by the

district that are sufficient:

(1) to pay operating and maintenance expenses of district

facilities;

(2) to pay the issued bonds as the bonds mature and the interest

that accrues on the bonds;

(3) to maintain the district's fund reserve; and

(4) to maintain other funds of the district provided by the

resolution that authorized the issuance of the bonds.

(d) A local government, water supply corporation, or other

entity that contracts with the district may:

(1) establish, charge, and collect fees, rates, charges,

rentals, or other amounts for services or facilities provided

under the contract; and

(2) pledge amounts that are sufficient to make the required

payments under the contract.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.205. ADMINISTRATION AND PLANNING COSTS FEE. (a) The

district may charge each member entity an annual pro rata fee to

pay for administration and planning costs incurred by the

district that are unrelated to capital projects financed by the

district.

(b) The fee may not exceed $2 per capita population of the

member entity unless the board and at least 75 percent of the

member entities of the district that together have at least 75

percent of the population of the district agree to a different

fee.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.206. IMPOSITION OF AD VALOREM TAXES PROHIBITED. The

district may not impose an ad valorem tax.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.207. DISTRICT PROPERTY AND PROJECTS EXEMPT FROM

TAXATION AND ASSESSMENT. The district is not required to pay a

tax or assessment on any property or project owned, operated,

leased, or controlled by the district.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

SUBCHAPTER F. BONDS

Sec. 7208.251. AUTHORITY TO ISSUE BONDS. The district may issue

bonds as provided by Chapters 1201 and 1371, Government Code, to

provide money for the district to exercise its powers and carry

out its purposes.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.252. ELECTION NOT REQUIRED. The district may issue

bonds without holding an election.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.253. BONDS EXEMPT FROM TAXATION. Bonds issued by the

district, the transfer of the bonds, and income from those bonds,

including profits made on the sale of the bonds, are exempt from

taxation in this state.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.254. PAYMENT AND SECURITY. (a) District bonds may

be:

(1) made payable from all or part of the revenue of the district

derived from any lawful source, including revenue derived from a

contract with a customer or other user of facilities owned or

operated by the district or from the ownership and operation of

any waterworks system, wastewater system, sewer system, solid

waste disposal system, or nonhazardous liquid waste system, or a

combination of those systems; and

(2) paid from and secured by liens on the pledges of all or part

of the revenue, income, or receipts derived from the district's

ownership, operation, lease, or sale of the property, buildings,

structures, or facilities, including the proceeds or revenue from

contracts with any person.

(b) District bonds may be additionally secured by a mortgage or

deed of trust on real property owned or to be acquired by the

district and by a chattel mortgage or lien on any personal

property appurtenant to that real property. The board may

authorize the execution of a trust indenture, mortgage, deed of

trust, or other form of encumbrance. The district may also

pledge to the payment of the bonds all or part of a grant, a

donation, or revenue or income received or to be received from

the United States or any public or private source.

(c) The district may pledge all or part of the district's

revenue, income, or receipts from fees, rentals, rates, charges,

or contract proceeds or payments to the payment of district

bonds, including the payment of principal, interest, and any

other amount required or permitted relating to the bonds. The

pledged fees, rentals, rates, charges, proceeds, or payments

shall be established and collected in amounts sufficient,

together with any other pledged resources, to provide for the

payment of expenses relating to the bonds and for operation and

maintenance and other expenses relating to those facilities.

(d) For purposes of Subsections (a) and (c), payments and

revenue pledged for the district's benefit under Sections

7208.158(a) and (b) are district revenue.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.255. MATURITY. District bonds may not have a term

that exceeds 40 years from the date of issuance.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.256. INTEREST RATE. District bonds shall bear an

interest rate as provided by the resolution that authorized the

issuance of the bond.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.257. ADDITIONAL BONDS. District bonds may provide for

the subsequent issuance of additional parity bonds or subordinate

lien bonds under terms provided in the resolution that authorized

the issuance of the bond.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.258. USE OF BOND PROCEEDS. (a) If permitted in the

resolution that authorized the issuance of the bond, the proceeds

from the sale of the bond may be used:

(1) to pay the interest on the bond during the period of

acquisition or construction of facilities to be provided through

the issuance of the bond;

(2) to pay the operating and maintenance expenses of district

facilities;

(3) to create a reserve fund for the payment of the principal of

and interest on the bond; and

(4) in any other manner that is necessary, appropriate, or

convenient to accomplish a district purpose.

(b) The proceeds from the sale of a bond may be placed on time

deposit or invested as provided by the resolution that authorized

the issuance of the bond.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.

Sec. 7208.259. NEGOTIABLE INSTRUMENTS. Obligations under this

chapter are negotiable instruments for purposes of Chapter 8,

Business & Commerce Code.

Added by Acts 2007, 80th Leg., R.S., Ch.

920, Sec. 1.07, eff. April 1, 2009.