1. January23,2014
PROP 6 AND HB 4:
FINANCING, PRIORITIZING, AND
CONSERVING TEXAS WATER IN THE 83rd
TEXAS LEGISLATURE
ELIZABETH A. FAZIO, J.D., LL.M. DIRECTOR,
HOUSE NATURAL RESOURCES COMMITTEE
GULF COAST WATER CONSERVATION SYMPOSIUM

2. 6 Other Pieces of Conservation Legislation:
HB 857
HB 1461
HB 3604
HB 3605
SB 198
SB 1
BIG SESSION FOR CONSERVATION IN TEXAS
83rd Legislative Session
GULF COAST WATER CONSERVATION SYMPOSIUM
consumer notice
of water loss
water conservation plans
2

3. GULF COAST WATER CONSERVATION SYMPOSIUM
HOUSE BILL 857
Rep. Lucio III and Sen. Ellis
ANNUALWATERLOSSAUDITS
3

4. HOUSE BILL 1461
Rep. Aycock and Sen. Fraser
CUSTOMERNOTIFICATION–SYSTEMWATERLOSS
GULF COAST WATER CONSERVATION SYMPOSIUM4

5. HOUSE BILLS 3604 & 3605
Rep. Burnam and Sen. Hegar
WATERCONSERVATIONPLANS
GULF COAST WATER CONSERVATION SYMPOSIUM
– Requires implementation of both DCP and
WCP
– Strengthens requirements for entities
receiving financial assistance* from the
TWDB:
• water loss mitigation
• BMPs
• industry standards and certifications
*mitigation must be in SWP if entity is using
SWIFT
5

6. – Ensures that HOAs cannot prohibit use of drought-
resistant landscape or water-conserving natural
turf.
– Allows HOAs to require the homeowner to
submit a plan
for such use.
LANDSCAPING
SENATE BILL 198
Sen. Watson and Rep. Dukes
GULF COAST WATER CONSERVATION SYMPOSIUM6

7. SENATE BILL 1
Sen. Williams and Rep. Pitts
–Water Conservation Education & Other
• $1,000,000 education grants (Avg FY approp is $4.68M)
• $2,000,000 for matching grants on ag irrigation
metering.
– Environment and Instream Flow Studies
• $2,000,000
CONSERVATIONAPPROPRIATIONS
GULF COAST WATER CONSERVATION SYMPOSIUM7

8. How has financing and prioritization been
addressed for the 2012 SWP?
“Trio of Bills”
• Senate Joint Resolution 1 (Prop 6)
– Constitutionally creates the SWIFT and SWIRFT
Voter approval in November 5th, 2013 general election by 73%.
• House Bill 1025
– Authorizes a one-time $2B transfer from the Rainy Day
Fund to the SWIFT.
• House Bill 4
– Provides for the structure, administration, and oversight of
the funds.
GULF COAST WATER CONSERVATION SYMPOSIUM8

9. HOUSE BILL 4
Rep. Ritter and Sen. Fraser
• Maximized Financial Structure
– $2B cash active management in SWIFT
– Revenue bonding authority in SWIRFT + existing
General Obligation bonding Authority
• Administration – BIG ON CONSERVATION
– Embraces conservation and reuse projects as part of overall
strategy to meet future needs and recognizes the need to
ensure rural areas are supported; and
– Requires the regional and statewide prioritization of
projects in the financing of the state water plan.
GULF COAST WATER CONSERVATION SYMPOSIUM
OVERVIEW
9

10. LEVERAGED MODEL WITH EXISTING
TWDB PROGRAMS
GULF COAST WATER CONSERVATION SYMPOSIUM
HB4FINANCIALSTRUCTURE
10

11. CONSERVATION
• Use of the Fund
• Eligibility
• Prioritization of Projects by TWDB
GULF COAST WATER CONSERVATION SYMPOSIUM
HB4ADMINISTRATION
Independence Creek
Copyright © 2010 Photographs by Charles Kruvand, from
The Living Waters of Texas, Texas A&M University Press
11

12. “TARGETED GOAL”
During the life of any 5-year SWP, the board
shall undertake to apply:
• 10% rural areas*
• 20% water conservation or reuse^
*agricultural water conservation
^agriculture irrigation projects
GULF COAST WATER CONSERVATION SYMPOSIUM
SWIFTUSEOFFUNDS
12

13. FINANCIAL ASSISTANCE
Applicant must:
• submit and implement a water
conservation plan
• complete a water infrastructure financing
survey.
*All projects must be included in the state water plan
GULF COAST WATER CONSERVATION SYMPOSIUM
SWIFTELIGIBILITY
13

14. PRIORITIZATION
Two-Tiers: Regional and Statewide
• Regions must prioritize projects within each
respective region using a uniform template
developed by stakeholders committee
– 5 minimal criteria
• TWDB must develop a point system for the
prioritization of projects at the time of its
request for financial assistance, including:
– high consideration factors
– 7 other factors
GULF COAST WATER CONSERVATION SYMPOSIUM
SWIFTPRIORITIZATION
14

15. Decade of need
Feasibility
Viability
Sustainability
Cost effectiveness
GULF COAST WATER CONSERVATION SYMPOSIUM
MINIMUMCRITERIATOBEUSEDBYSTAKEHOLDERS
REGIONAL PRIORITIZATION
15

16. Serves large population
Assists both urban and rural
Provides regionalization; OR
Meets high % of water users’ needs
GULF COAST WATER CONSERVATION SYMPOSIUM
HIGHESTCONSIDERATION
TOBECONSIDEREDBYTWDB
PRIORITIZATION OF THE PROJECTS
16

17. Local financial contribution
Financial capacity of applicant to repay
Ability to leverage with local and federal funding
Emergency need
Readiness to proceed
Projected effect on water conservation
Priority given by region
GULF COAST WATER CONSERVATION SYMPOSIUM
OTHERFACTORS
TOBECONSIDEREDBYTWDB
PRIORITIZATION OF THE PROJECTS
17

18. CONSERVATION
“Demonstrated or projected effect of the
project on water conservation”
• Prevention of water loss; and
• Filing of a water loss audit which
demonstrates accountability for
reducing water loss and increasing
efficiency in the distribution of water.
GULF COAST WATER CONSERVATION SYMPOSIUM
SWIFTPRIORITIZATION

19. How will it all work together?
8.3 million acre-
feet of water
short in repeat
drought of record
by 2060
16 regional water
planning groups
9 million acre-feet of
water supplied by
2012 SWP
recommended
strategies
562
recommended
strategies
produced by
regional
planning groups
$53.1 billion in capital
costs are needed to
implement the plan
46 million people
in Texas by 2060
19

20. 2012 SWP STRATEGIES
% OVERALL
GULF COAST WATER CONSERVATION SYMPOSIUM20
CONSERVATIONBYTHENUMBERS
OVERALL

21. IRRIGATION AND MUNICIPAL
CONSERVATION OUT OF $53B
• Out of the TOTAL capital cost of the plan:
– Irrigation $902M or 1.7% Overall
– Municipal $24M or 0.05% Overall
GULF COAST WATER CONSERVATION SYMPOSIUM
2012SWPCAPITALCOSTS
MAJORCONSERVATION-$
21

22. Other Surface Water, 54.18%
Irrigation Conservation, 0%
Municipal
Conservation, 0.02%
Other Conservation, 0%
New Major
Reservoirs, 15.08%
Reuse, 10.36%
Groundwater, 8.39%
Groundwater
Desalination, 2.77%
Seawater
Desalination, 5.94%
Surface Water
Desalination, 0.05%
Conjunctive Use, 1.39%
Aquifer Storage and
Recovery, 1.82%
Brush Control, 0%
Weather Modification , 0%
GULF COAST WATER CONSERVATION SYMPOSIUM
CONSERVATIONBYTHENUMBERS
REQUESTED
2012 SWP CAPITOL COST
% REQUESTED OUT OF $27B
22

23. CONSERVATION SOLUTIONS
• Reducing Water Loss Systems
• Educational Programs
• Customer-side Municipal Water
Conservation Programs
– Such As Retrofitting Toilets and Other Water-
Using Devices With Low Flow
• “PACE-like” Programs
CONSERVATIONIDEASFORFUTURESWP
GULF COAST WATER CONSERVATION SYMPOSIUM23

24. PROCEED WITH CAUTION
• Article III, Sec. 52(a) is known as “the gift
clause.”
– “shall have no power”…”to lend its credit or to
grant public money or thing of value in aid
of, or to any individual, association, or
corporation…”
– Prohibits the use of public funds for private
benefit
THEGIFTCLAUSE
GULF COAST WATER CONSERVATION SYMPOSIUM24

25. DEFINE PUBLIC PURPOSE
• Texas caselaw supports 4-part test in
defining “public purpose:”
1. Does the expenditure serve a public purpose?
2. Are there sufficient controls on the expenditure to
ensure that the public purpose will be carried out;
3. Is the public protected in the use of the public funds to
accomplish the intended result; and
4. Has adequate consideration passed to the political
subdivision making the expenditure?
PUBLICPURPOSEV.PRIVATEBENEFIT
GULF COAST WATER CONSERVATION SYMPOSIUM25

26. What is the past, present, and future for
SWIFT?
GULF COAST WATER CONSERVATION SYMPOSIUM
Agency
Rulemaking
Other Timelines
26

27. PAST: TWDB AND THE SWIFT
• Governance changes: 3 full-time TWDB
Members
• Agency restructure into 6 planning divisions
• Ag and Rural Ombudsman has been
appointed, Doug Shaw
• Public rulemaking process is underway
GULF COAST WATER CONSERVATION SYMPOSIUM
AGENCY
27

28. PRESENT: SWIFT PROCESS
• Regional stakeholders adopt uniform standards
(Dec 2013)
• TWDB public work sessions
– Conroe
– Lubbock
– Harlingen
• Draft regional prioritization (June 2014)
• Draft SWIFT rule (approx. June 2014)
• Final regional prioritization (September 2014)
• Final SWIFT rule (approx. December 2014 ,but no
later than March 2015)
RULEMAKING
GULF COAST WATER CONSERVATION SYMPOSIUM28

29. FUTURE: SWIFT AND SWP
• Regional plans due December 2015
*Along with new prioritization
• State Water Plan published January 2017
GULF COAST WATER CONSERVATION SYMPOSIUM
OTHERTIMELINES
29

30. January23,2014
QUESTIONS?
ELIZABETH A. FAZIO, J.D., LL.M.
DIRECTOR, HOUSE COMMITTEE ON NATURAL RESOURCES
P.O. BOX 301872, E2.104
AUSTIN, TX 78769
TELEPHONE: (512) 463-0802
elizabeth.fazio_hc@house.state.tx.us
GULF COAST WATER CONSERVATION SYMPOSIUM