TITLE: Relating to the consideration of compliance with rules of the Texas Commission on Environmental Quality in approving rates for water or sewer utility services.

SUMMARY: Relating to the consideration of compliance with rules of the Texas Commission on Environmental Quality in approving rates for water or sewer utility services.

FULL TEXT:
AN ACT relating to the consideration of compliance with rules of the Texas Commission on Environmental Quality in approving rates for water or sewer utility services. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Section 13.184(b), Water Code, is amended to read as follows: (b) In fixing a reasonable return on invested capital, the regulatory authority shall consider, in addition to other applicable factors, the efforts and achievements of the utility in the conservation of resources, whether the utility is in compliance with commission rules, the quality of the utility's services, the efficiency of the utility's operations, and the quality of the utility's management. SECTION 2. Section 13.185, Water Code, is amended by adding Subsection (g-1) to read as follows: (g-1) When considering a utility's historic test year information to determine reasonable and necessary expenses, the regulatory authority shall consider whether the utility complied with commission rules during that test year. SECTION 3. The changes in law made by this Act apply only to a rate proceeding under Chapter 13, Water Code, that begins on or after the effective date of this Act. A rate proceeding that begins before the effective date of this Act is governed by the law in effect on the date the rate proceeding began, and the former law is continued in effect for that purpose. SECTION 4. This Act takes effect September 1, 2025.