BHDA partners Susan M. Maxwell and Claudia Russell were speakers at the Austin Bar Association’s recent Administrative Law CLE. Their presentation “Developing Issues in Texas Water Supply and Demand” covered the recent Sunset review of the state’s water-related agencies and other developments from the 88^th Legislature, along with related upcoming agency rulemaking proceedings. Examining the areas of both state-regulated surface water and more locally regulated groundwater, the presentation also addressed emerging strategies for water supply development and major administrative practice issues related to that development in these regulatory arenas.

Ms. Maxwell practices in water rights law, environmental law, and administrative law. She assists clients in developing and securing water supplies and water rights. She also represents clients before the State Office of Administrative Hearings and the Texas Commission on Environmental Quality in contested case hearings concerning water rights and in judicial appeals of those administrative decisions.

Ms. Russell is an attorney and government relations expert with a background that includes employment in all three branches of government and an extensive network of key legislators, decision makers, and lobbyists in Texas. She has worked for and with both Republican and Democrat legislators in the House and Senate during her 23-year career associated with the Texas Legislature.

The 88th Texas Legislature resulted in a variety of enacted bills that affect aspects of environmental, water, and utility law practice. In their article featured in The Texas Bar Journal’s Legislative Update Issue, Claudia Russell and Susan Maxwell provide summaries and highlights of some key bills that are effective as of September 1, 2023 (unless otherwise noted).

Read the full article here.

The 88th Regular Session resulted in a variety of enacted bills that affect the firm’s local government clients. There were 8,344 bills and joint resolutions filed, and 1,258 bills passed. That’s an increase from the 87th Regular Session where 1,073 bills passed. A large portion of the newly enacted bills affect local governments; too many to list individually in this report but highlights of some key bills are summarized below by BHDA attorney and government relations expert Claudia Russell.

Super Preemption

HB 2127– This controversial bill applies to both cities and counties and expressly preempts certain city home rule regulations. It potentially preempts other regulations in fields occupied by state statute. It creates a cause of action for lawsuits against local governments to determine whether a regulation is preempted and requires three months’ notice before a claimant can bring a lawsuit. The bill expressly protects the following city authority:

• Existing payday lending ordinances, if valid under previous law;
• Existing regulations of the retail sale of dogs or cats, until the state adopts statewide regulations;
• Ability to regulate a massage establishment;
• Ability to maintain roads, impose taxes, and carry out any authority expressly authorized by statute;
• Authority to conduct a public awareness campaign;
• Ability to negotiate terms of a collective bargaining agreement; and
• Adoption of policies related to city employees.

The bill expressly preempts the following city regulations:

• Regulations relating to employment leave, hiring practices, breaks, employment benefits, scheduling practices, and other terms of employment that exceed or conflict with federal or state law;
• Regulations involving the breeding, care, treatment, or sale of animals or animal products if person holds a license for the business issued by federal or state government; and
• Regulations of evictions or delivery of notice to vacate prior to an eviction.

HB 2127 also provides that unless expressly authorized, an ordinance or order that regulates conduct in a field of regulation that is occupied by a provision of one of the following codes is void and unenforceable:

• Agriculture Code;
• Business & Commerce Code;
• Finance Code;
• Insurance Code;
• Labor Code;
• Natural Resources Code;
• Occupations Code; and
• Property Code.

Major cities across Texas have already filed lawsuits claiming the bill to be unconstitutional. Even if the newly enacted bill survives a constitutional challenge, interested parties note that the extent of the super preemption will not be fully known for years while courts determine when a state statute occupies a field of regulation.

Targeted Preemption

SB 1017 provides that a municipality cannot regulate an energy source or engine.

SB 784 provides that a municipality cannot regulate greenhouse gas emissions.

HB 1750 & HJR 126: Both bills limit municipal regulation of agricultural within the city limits and extraterritorial jurisdiction (ETJ).

HB 1598 limits a municipality’s ability to regulate the siting of municipal solid waste facilities.

Land Use- ETJ Release

SB 2038 allows residents and property owners in a municipality’s extraterritorial jurisdiction (ETJ) to use either the petition or election process as outlined in the bill to remove themselves from the ETJ. These release provisions do not apply to land that is:

• Designated as industrial district;
• Subject to a strategic partnership agreement;
• Located within five miles of a military base;
• Voluntarily annexed into a city’s ETJ if located in high growth county with population over 240,000; and
• Located in certain parts of San Antonio ETJ.

Annexations after January 1, 2023, do not expand the ETJ unless would-be residents of the ETJ request inclusion. And if an area is released from ETJ, any city/county interlocal agreements giving city authority to regulate subdivisions are terminated as to the area and the county is granted the authority.

Land Use- Inspections and Payment for Nonconforming Use

HB 14 authorizes third party review of development documents or permits and third-party inspections if not acted upon or completed within 15 days of statutory deadline. A third party who reviewed a development document or conducted an inspection would be required to take actions in accordance with all applicable provisions of law and notify the regulatory authority of the results of the review or inspection within 15 days of completing the review or inspection. Regulatory authorities can prescribe a reasonable format for the notice.

SB 929 relates to the notice and compensation a municipality must provide before revoking the right to use property for a use that was allowed before the adoption of or change to a zoning regulation or boundary. The bill requires the governing body of a municipality or a zoning commission to provide written notice to property owners and occupants of each public hearing regarding any proposed adoption of or change to a zoning regulation or boundary that could result in a current conforming use of a property becoming a nonconforming use. The bill also establishes the compensation that the owner or lessee of property with a nonconforming use is entitled to receive if the nonconforming use is required to cease operation due to being a nonconforming use.

Taxation

HB 4082 prohibits a county from issuing certificates of obligations or tax notes for a facility for professional or semi-professional sports, a stadium, arena, civic center, convention center, coliseum, or a hotel.

Finance

SB 22 relates to the establishment of grant programs to provide financial assistance to qualified sheriff’s departments, district attorney’s offices, and county attorney’s offices in rural counties. It establishes rural sheriff’s office and rural prosecutor’s office salary assistance grant programs.

Governance

SB 29 relates to prohibited governmental entity implementation or enforcement of a vaccine mandate, mask requirement, or private business or school closure to prevent to the spread of COVID-19.

• SB 29 prohibits a governmental entity from implementing the aforementioned. Limitations on mandates related to face masks would not apply to state supported living centers, facilities operated by the Texas Criminal Justice Department or the Texas Juvenile Justice Department, municipal or county jails, or hospitals or other health care facilities owned by a governmental entity that were subject to certain other rules prescribed by a government agency which conflicted with the limitation. Limitations on mandates related to vaccines would apply only to the extent that the prohibition did not conflict with certain federal rules.

SB 271 requires local governments to report cyber incidents to the state.

SB 1893 prohibits the use of TikTok on any local government device.

Personnel

HB 471 requires a political subdivision to provide its paid firefighters, police officers, and emergency medical services personnel a leave of absence for an illness or injury related to the person’s line of duty. A person may use the person’s accumulated sick leave, vacation time, and other accrued benefits before the person is placed on temporary leave. The temporary leave is with full pay for a period commensurate with the nature of the line of duty illness or injury and the leave must be continued, if necessary, for at least one year. Among other provisions, the bill provides for a person’s return to light duty with a temporary disability, authorizes another firefighter, police officer, or emergency medical services personnel to voluntarily do the work of the injured firefighter, police officer, or emergency medical services personnel until the person returns to duty, and provides that any workers’ compensation benefits provided to the person must be offset, to the extent applicable, by any amount for incapacity received as provided by the bill’s provisions.

Purchasing

HB 2965 provides that governmental entities cannot force contractors to waive Chapter 2272, Government Code, (Certain Construction Liability Claims) in filing bids or after contracts have been awarded.

Environment

HB 4385 allows a municipality to provide sewer service to areas of less than 15 connections without a certificate of convenience and necessity (CCN) and is not within the certificated area of another retail public utility.

Courts

HB 2620 requires the Texas Department of Criminal Justice (TDCJ) to review and certify the required documents delivered to TDCJ during the scheduled admission of a new person within three days of receiving the documents. TDCJ is required to take custody of a person awaiting transfer following a conviction of a felony no later than 45 days after all documents have been reviewed and certified by TDCJ. If TDCJ has not taken custody of a person within the 45-day period, TDCJ is required to compensate the county for:

• 125 percent of the cost of confinement for each day the person remained confined in the county jail following the 45-day period;
• the cost of confinement for each day beginning when TDCJ received the required documents and ending on the date TDCJ certified the required documents; and
• the cost to the county for all medical, behavioral health, and pharmaceutical care provided to the person while confined beginning on the date TDCJ received the required documents.
• By September 30, 2023, the Texas Board of Criminal Procedures is required to adopt the scheduled admissions policy required by the bill. The compensation to counties would only apply to costs related to the confinement of a person that occurred after October 1, 2023, regardless of whether the requirements for the transfer of the person were completed before, on, or after that date.

BHDA partners Claudia Russell and Susan Maxwell recently had an article on environmental law published in the Texas Bar Journal’s “The Legislative Update Issue” (September 2021).

In the article “Environmental and Water Law,” Ms. Russell and Ms. Maxwell highlight key bills passed during the 87^th regular legislative session that affect aspects of environmental, water, and utility law.

Read the full piece here.

With the 87^th Regular Legislative Session ending last month and Governor Greg Abbott’s veto period ending June 20, 2021, Texas officially has new laws affecting local governments pertaining to governance, finance, and open government. BHDA attorney Claudia Russell provides an explanation below of several bills that are of interest to our local government clients.

One of the most important bills to note is HB 2073.  That is because it requires affirmative action from local governments. House Bill 2073 requires the governing body of a political subdivision to develop and implement a paid quarantine leave policy for fire fighters, peace officers, detention officers, and emergency medical technicians ordered by a supervisor or health authority to quarantine due to exposure to a communicable disease while on duty. Critics of the bill said while the goal of the bill is laudable, the bill’s language of “communicable disease” is too broad and open to interpretation, potentially allowing application of the bill’s provisions in cases of less serious diseases such as seasonal flu. Critics also pointed out that it will be difficult to determine with certainty whether exposure to a communicable disease occurred while on duty. However, those arguments fell on deaf ears as HB 2073 sailed through both chambers. In addition to pay and benefits, the policy must also cover reasonable costs of quarantine, including lodging, medical and transportation. The new law also provides political subdivisions cannot reduce a paid leave balance, including sick leave, vacation time, or holidays, for such first responders in connection with quarantine leave ordered by their supervisors or a health authority. This bill was signed by Governor Abbott on June 15, 2021 and is effective immediately.

In 2019, the 86^th Legislature enacted property tax reforms to require taxing units that proposed tax rates higher than a certain level, called the voter-approval rate, to hold an election so that voters could approve the increases.  This limitation did not include many kinds of debt issued by a taxing unit, including certificates of obligations (COs). Members of the legislature critical of local governments saw this as a loophole that they argued led to some Texas municipalities improperly issuing increasing amounts of debt to avoid holding an election. So, the legislature took aim at how current law defines “debt” and passed HB 1869. One of the first versions of the bill limited the definition of “debt”, for purposes of calculating property taxes, to include a bond, warrant, certificate of obligation, or other evidence of indebtedness that also met one of the following criterial: (1) was approved at an election, (2) included self-supporting debt, (3) evidenced a loan under a state or federal financial assistance program; (4) was issued for designated infrastructure, (5) was a refunding bond, or (6) was issued in response to an emergency.  And at first, “designated infrastructure” only included (a) streets, roads, or highways, (b) telecommunications, (c) cyber security, or (d) a part of any utility system, water supply project, water plant, wastewater plant, water and wastewater distribution or conveyance facility, wharf, dock or flood control and drainage project.

Critics of HB 1869 pointed out that the bill infringed on local control and flexibility by further limiting how the elected representatives of a community set their budgets and that flexibility is especially important in communities with high growth that need to respond quickly to calls for increased services. Luckily, HB 1869 was amended, and “designated infrastructure” now also includes bridges, sidewalks, parks, landfills, parking structure, airports, police stations, fire stations, or other public safety facilities, jails, juvenile detention facilities, or judicial facilities, and any facilities that are physically attached to listed facilities. The bill was also amended so that COs can be used for renovating, improving, or equipping existing buildings or facilities and for vehicles or equipment. With all the exceptions that were added, interested local officials questioned the need for the bill. Nonetheless the legislature passed the water-downed bill, and local governments wishing to issue COs will now need to verify that the use is listed in the exceptions. Governor Abbott signed HB 1869 on June 15, 2021 and it becomes effective September 1, 2021.

On the open records front, several bills passed affecting exceptions to the Texas Public Information Act  (TPIA) found in Chapter 552 of the Texas Government Code. The common theme around four of these bills is protection of information of elected officials, peace officers, judges, and prosecutors. House Bill 1082 adds all elected public officers to the list of those whose information related to home address, home telephone number, emergency contact or Social Security number is excepted from disclosure under the Public Information Act. Governor Abbott signed HB 1082, and it is effective immediately. Senate Bill 841 extends the exception from public disclosure of personal information of a current peace officer or current commissioned security officer at a private institution of higher education to include an honorably retired peace officer or commissioned security officer. Governor Abbott signed SB 841, and it is effective immediately. Current law provides address confidentiality for federal and state court judges. Senate Bill 1134 expands current law and provides for address confidentiality for federal bankruptcy judges, United States marshals, and United States attorneys and their family members. Governor Abbott signed SB 1134, and it is effective September 1, 2021. Along the same lines, SB 56 excepts from public disclosure personal information of a current or former federal prosecutor or public defender. Governor Abbott signed SB 56, and it is effective immediately.

A couple of open records bills were passed in keeping up with technology. Some municipally owned electric utilities operate a program to provide chilled water to large electric customers to reduce peak electric demand and shift electric load. House Bill 3615 amends the Government Code to exclude information related to a public power utility’s chilled water program from the public power utility competitive matters exception to public disclosure.  The bill subjects information or records reasonable related to any of the following to public disclosure: 1) a municipally owned utility’s rate review process; 2) the method a municipality or municipally owned utility uses to set rates for retail electric service or 3) the method a municipality or municipally owned utility uses to set rates for a chilled water program. Governor Abbott signed HB 3615, and it is effective September 1, 2021. And, in an effort to protect customers’ sensitive information from predatory practices, the legislature passed HB 872 which excepts from public disclosure customer information maintained by a government-operated utility that provides water, wastewater, sewer, gas, garbage, electricity, or drainage services. The exception includes information collected as part of an advanced metering system and information that revealed whether an account was delinquent or eligible for disconnection. Governor Abbott signed HB 872, and it is effective immediately.

Lastly, it is important to note the passage of SB 1225 because it limits governmental bodies from requesting multiple, consecutive catastrophe notices. Last session, SB 494 passed and codified a long-standing informal practice of allowing governmental bodies, on rare occasions, to temporarily suspend certain provisions of the TPIA due to catastrophes, natural disasters and emergencies. Critics of local governments argued that during the COVID-19 pandemic certain governmental bodies abused the temporary suspension process, requesting multiple, consecutive catastrophe notices thus creating roadblocks to information during a trying time. Senate Bill 1225 specifies that a catastrophe notice and suspension of the TPIA should not be allowed unless the incident significantly impacts a governmental body and directly causes the inability of a governmental body to comply with requirements of the TIPA. The bill provides that a catastrophe does not apply to periods in which a governmental body is required to work remotely but can still electronically access requested information and other wise respond to TPIA requests. The bill also provides for the suspension of TPIA provisions once per catastrophe, with an option one-time extension. Governor Abbott signed SB 1225, and it is effective September 1, 2021.

Related News: Employment Law Update: New Employment-Related Bills Passed by the 87th Legislature

An article by Claudia C. Russell and Gregory D. Miller was recently featured in Texas County Progress magazine. The article, which was included in the publication’s August 2020 issue, addresses the impact of legislative changes on counties’ bond elections.

“For those counties that will be placing bond propositions on their ballots this November, it would be a good idea to consider the ways in which recent legislation affects the drafting of bond propositions.” To continue reading, click here.

This case law update (and presentation that follows) was presented at the 2015 UTCLE Texas Water Law Institute.  Purchase of the full CLE program is available here: CLE.  The update provides information about litigation that has occurred or is occurring around the state and before the Texas Commission on Environmental Quality (TCEQ) and the Public Utility Commission of Texas (PUC).  These cases cover topics related to surface and groundwater rights, water and sewer utility matters, ratemaking proceedings, water quality permitting matters, questions of standing, issues regarding flooding, and open meetings and open records.

Paper presented at the 2014 Changing Face of Water Rights CLE, February 27-28, 2014 in San Antonio, Texas. 

This paper focuses on rules, regulations, and other legal obstacles facing landowners.