2023 Texas Statutes › Water Code › Title 2 - Water Administration › Subtitle B - Water Rights › Chapter 13 - Water Rates and Services › Subchapter G. Certificates of Convenience and Necessity › Section 13.246. Notice and Hearing; Issuance or Refusal; Factors Considered

Sec. 13.246.  NOTICE AND HEARING; ISSUANCE OR REFUSAL; FACTORS CONSIDERED.  (a)  If an application for a certificate of public convenience and necessity or for an amendment to a certificate is filed, the utility commission shall cause notice of the application to be given to affected parties and to each county and groundwater conservation district that is wholly or partly included in the area proposed to be certified.  If requested, the utility commission shall fix a time and place for a hearing and give notice of the hearing.  Any person affected by the application may intervene at the hearing.
(a-1)  Except as otherwise provided by this subsection, in addition to the notice required by Subsection (a), the utility commission shall require notice to be mailed to each owner of a tract of land that is at least 25 acres and is wholly or partially included in the area proposed to be certified.  Notice required under this subsection must be mailed by first class mail to the owner of the tract according to the most current tax appraisal rolls of the applicable central appraisal district at the time the utility commission received the application for the certificate or amendment.  Good faith efforts to comply with the requirements of this subsection shall be considered adequate notice to landowners.  Notice under this subsection is not required for a matter filed with the utility commission or the commission under:
(1)  Section 13.248 or 13.255; or
(2)  Chapter 65.
(b)  The utility commission may grant applications and issue certificates and amendments to certificates only if the utility commission finds that a certificate or amendment is necessary for the service, accommodation, convenience, or safety of the public.  The utility commission may issue a certificate or amendment as requested, or refuse to issue it, or issue it for the construction of only a portion of the contemplated system or facility or extension, or for the partial exercise only of the right or privilege and may impose special conditions necessary to ensure that continuous and adequate service is provided.
(c)  Certificates of public convenience and necessity and amendments to certificates shall be granted by the utility commission on a nondiscriminatory basis after consideration by the utility commission of:
(1)  the adequacy of service currently provided to the requested area;
(2)  the need for additional service in the requested area, including whether any landowners, prospective landowners, tenants, or residents have requested service;
(3)  the effect of the granting of a certificate or of an amendment on the recipient of the certificate or amendment, on the landowners in the area, and on any retail public utility of the same kind already serving the proximate area;
(4)  the ability of the applicant to provide adequate service, including meeting the standards of the commission, taking into consideration the current and projected density and land use of the area;
(5)  the feasibility of obtaining service from an adjacent retail public utility;
(6)  the financial ability of the applicant to pay for the facilities necessary to provide continuous and adequate service and the financial stability of the applicant, including, if applicable, the adequacy of the applicant's debt-equity ratio;
(7)  environmental integrity;
(8)  the probable improvement of service or lowering of cost to consumers in that area resulting from the granting of the certificate or amendment; and
(9)  the effect on the land to be included in the certificated area.
(d)  The utility commission may require an applicant for a certificate or for an amendment to provide a bond or other financial assurance in a form and amount specified by the utility commission to ensure that continuous and adequate utility service is provided.
(e)  Where applicable, in addition to the other factors in this section the utility commission shall consider the efforts of the applicant:
(1)  to extend service to any economically distressed areas located within the service areas certificated to the applicant; and
(2)  to enforce the rules adopted under Section 16.343.
(f)  If two or more retail public utilities or water supply or sewer service corporations apply for a certificate of public convenience and necessity to provide water or sewer utility service to an uncertificated area located in an economically distressed area and otherwise meet the requirements for obtaining a new certificate, the utility commission shall grant the certificate to the retail public utility or water supply or sewer service corporation that is more capable financially, managerially, and technically of providing continuous and adequate service.
(g)  In this section, "economically distressed area" has the meaning assigned by Section 15.001.
(h)  Except as provided by Subsection (i), a landowner who owns a tract of land that is at least 25 acres and that is wholly or partially located within the proposed service area may elect to exclude some or all of the landowner's property from the proposed service area by providing written notice to the utility commission before the 30th day after the date the landowner receives notice of a new application for a certificate of public convenience and necessity or for an amendment to an existing certificate of public convenience and necessity.  The landowner's election is effective without a further hearing or other process by the utility commission.  If a landowner makes an election under this subsection, the application shall be modified so that the electing landowner's property is not included in the proposed service area.  An applicant for a certificate of public convenience and necessity that has land removed from its proposed certificated service area because of a landowner's election under this subsection may not be required to provide service to the removed land for any reason, including the violation of law or utility commission or commission rules by the water or sewer system of another person.
(i)  A landowner is not entitled to make an election under Subsection (h) but is entitled to contest the inclusion of the landowner's property in the proposed service area at a hearing held by the utility commission regarding the application if the proposed service area is located within the boundaries or extraterritorial jurisdiction of a municipality with a population of more than 500,000 and the municipality or a utility owned by the municipality is the applicant.
(j)  This section does not apply to an application under Section 13.258 or a correction under Section 13.244(e).
Added by Acts 1985, 69th Leg., ch. 795, Sec. 3.005, eff. Sept. 1, 1985.  Amended by Acts 1987, 70th Leg., ch. 539, Sec. 15, eff. Sept. 1, 1987;  Acts 1989, 71st Leg., ch. 567, Sec. 24, eff. Sept. 1, 1989;  Acts 1991, 72nd Leg., ch. 678, Sec. 6, eff. Sept. 1, 1991;  Acts 1997, 75th Leg., ch. 1010, Sec. 6.08, eff. Sept. 1, 1997;  Acts 1999, 76th Leg., ch. 404, Sec. 31, eff. Sept. 1, 1999.
Amended by:
Acts 2005, 79th Leg., Ch. 1145 (H.B. 2876), Sec. 6, eff. September 1, 2005.
Acts 2007, 80th Leg., R.S., Ch. 1430 (S.B. 3), Sec. 2.09, eff. September 1, 2007.
Acts 2009, 81st Leg., R.S., Ch. 363 (H.B. 1295), Sec. 1, eff. September 1, 2009.
Acts 2011, 82nd Leg., R.S., Ch. 1325 (S.B. 573), Sec. 3, eff. September 1, 2011.
Acts 2013, 83rd Leg., R.S., Ch. 170 (H.B. 1600), Sec. 2.47, eff. September 1, 2013.
Acts 2013, 83rd Leg., R.S., Ch. 171 (S.B. 567), Sec. 47, eff. September 1, 2013.
Acts 2017, 85th Leg., R.S., Ch. 948 (S.B. 1842), Sec. 3, eff. September 1, 2017.
Acts 2023, 88th Leg., R.S., Ch. 1083 (S.B. 893), Sec. 2, eff. June 18, 2023.