Sec. 552.024. MUNICIPAL CONTRACT FOR RECLAIMED WATER FACILITY IN CERTAIN MUNICIPALITIES. (a) In this section, "reclaimed water project" means the design, construction, equipment, repair, reconstruction, replacement, expansion, operation, or maintenance of:

(1) a reclaimed water facility with a capacity of not less than 10 million gallons per day to be owned by a municipality; and

(2) related infrastructure.

(b) This section applies only to a home-rule municipality that:

(1) has a population of at least 99,000 and not more than 160,000;

(2) is located in two counties, only one of which has a population of at least 132,000 and not more than 170,000; and

(3) owns and operates a water system, sewer system, or combined system.

(c) A municipality to which this section applies may execute, perform, and make payments under a contract with any person for the development of a reclaimed water project and the provision of water from that project.

(d) A contract entered into under this section is an obligation of the municipality that:

(1) may provide that:

(A) the contract is payable from a pledge of the revenues of the water system, sewer system, or combined system of the municipality; or

(B) the payments from the municipality are an operating expense of the water system, sewer system, or combined system of the municipality; and

(2) may not be made payable from ad valorem taxes.

(e) A contract entered into under this section may:

(1) be in the form and on the terms considered appropriate by the governing body of the municipality;

(2) be for the term approved by the governing body of the municipality and contain an option to renew or extend the term;

(3) provide for the design, construction, and financing of the reclaimed water project by the person with whom the municipality contracts for the development of the reclaimed water project; and

(4) provide for the provision of reclaimed water for industrial purposes at specified rates for the term approved by the governing body of the municipality as part of the consideration for the acquisition of the reclaimed water project by the municipality.

(f) If a contract entered into under this section provides for the design, construction, and financing of the reclaimed water project by the person with whom the municipality contracts:

(1) a contract procurement or delivery requirement applicable to the municipality does not apply to the reclaimed water project; and

(2) Chapter 2254, Government Code, does not apply to the reclaimed water project.

(g) Subchapter I, Chapter 271, applies to a written contract entered into under this section as if the contract were a contract described by Section 271.151(2).

(h) To the extent of a conflict with another statute or municipal charter provision or ordinance, this section controls.

(i) The validity or enforceability of a contract entered into under this section by a municipality is not affected if, after the contract is entered into, the municipality no longer meets the requirements described by Subsection (b).

Added by Acts 2017, 85th Leg., R.S., Ch. 78 (H.B. 101), Sec. 1, eff. May 23, 2017.