Mais conteúdo relacionado Semelhante a 2013 TRWA Districts Conference: Districts - Back to Basics (19) 2013 TRWA Districts Conference: Districts - Back to Basics1. DISTRICTS:
Back to Basics
2013 TRWA Districts Conference
October 2013
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
2. Part 1
Overview of Operations
including district powers and duties, service
standards and responsibilities, board member
responsibilities and policies, conducting
meetings, adopting and enforcing service
policies, and the challenges of serving
urbanizing areas.
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
3. What is a Utility District?
• Utility Districts are local political
subdivisions that may provide water,
wastewater, drainage and other services
– Typically governed by board members
elected by qualified voters from within the
District
– Can be funded by utility revenues and
property taxes
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
4. Utility District Authority in
Texas
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
5. Constitution
Article III, Section 52
– (b) Under Legislative provision, …any …defined
district now or hereafter to be described and
defined within the State of Texas, …may issue
bonds … in any amount not to exceed one-fourth
of the assessed valuation of the real property of
such district… and levy and collect taxes to pay
the interest thereon and provide a sinking fund
for the redemption thereof, as the Legislature
may authorize, and in such manner as it may
authorize the same, for the following purposes to
wit:
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
6. Constitution
Article III, Section 52 (cont.)
• Improvement of rivers, creeks, and streams to
prevent overflows, and to permit of navigation
thereof, or irrigation thereof, or in aid of such
purposes.
• Construction and maintenance of pools, lakes,
reservoirs, dams, canals and waterways for the
purposes of irrigation, drainage or navigation, or
in aid thereof.
• Construction, maintenance and operation of
macadamized, graveled or paved roads and
turnpikes, or in aid thereof.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
7. Constitution
Article XVI, Section 59
• The conservation and development of all of the natural
resources of this State… including
• the control, storing, preservation and distribution of its storm and flood
waters, the waters of its rivers and streams, for irrigation, power and
all other useful purposes,
• the reclamation and irrigation of its arid, semiarid and other lands
needing irrigation,
• the reclamation and drainage of its overflowed lands, and other lands
needing drainage,
• the conservation and development of its forests, water and hydroelectric power,
• the navigation of its inland and coastal waters, and
• the preservation and conservation of all such natural resources of the
State
are each and all hereby declared public rights and duties;
and the Legislature shall pass all such laws as may be
appropriate thereto.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
8. Constitution
Article XVI, Section 59
• There may be created within the State of Texas,
or the State may be divided into, such number
of conservation and reclamation districts as may
be determined to be essential to the
accomplishment of the purposes of this
amendment to the constitution, which districts
shall be governmental agencies and bodies
politic and corporate with such powers of
government and with the authority to exercise
such rights, privileges and functions concerning
the subject matter of this amendment as may be
conferred by law.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
9. The Statutes
• Chapter 49 – General Statute
• Chapter 65 – Special Utility Districts
• Chapters 51-67 – Other types of
special districts related to water
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
10. Utility Districts in Texas
• 1663 Active Utility Districts in Texas*
– 64 Special Utility Districts
– 879 Municipal Utility Districts
* Based upon TCEQ Water Utility Database Records 11/05/2013
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
11. 2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
12. Creating a District
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
13. Why create a Utility District?
• Utility Districts ensure adequate funding
of water supply and wastewater collection
systems for local communities
– Spread costs to all customers and
landowners through rates and taxes
• Utility Districts enjoy sovereign immunity
and limited tort liability.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
14. Creation
• Legislative Process
– Local Bills
• Administrative Process
– State
– County
• Creation Records are Important!
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
15. Creation
• Voters must approve creation and
authorize any taxing and bonding
authority.
• Elections must comply with State and
Federal election laws.
• Creation and confirmation election
records are a District’s “incorporation”
documents.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
17. Board of Directors
• Composition of board varies by type of Districts (most
5 members)
• Election to 4-year terms (3-year terms for SUDs)
• Qualification for Office
– at least 18 years of age; and
– a resident citizen of the state that is:
• a qualified voter within district (not WCIDs, WIDs, Irrig. Districts
or FWSDs);
• a user of the facilities of the district (SUDs only), or
• an owner of land subject to taxation in the district (not Drainage
District).
• Vacancies (most filled by Board appointment)
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
18. Board Member
Requirements
• Oaths of office and statements for public
officials.
• Post Bonds of $10,000 for each board
member
• Open Meetings and Open Records
Training to be completed by all Board
Members.
– Must be completed within 90 days of taking
office.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
19. Local Oversight
• County Attorney
– Can file suit in court to remove board
members for:
•
•
•
•
Misconduct
Official Misconduct
Incompetency
Intoxication
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
20. Meetings
• Required to hold regular and special
meetings as necessary to conduct
District’s business
• Required to keep complete account of all
meetings and proceedings.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
21. Recordkeeping
• Approve a Records Management
Program, including:
– Order Establishing Records Management
Program, Appointing Records Management
Office, and Appointing Public Information
Coordinator; and
– Declaration of Compliance with Records
Scheduling Requirement of the Local
Government Act.
– File with State Library and Archives
Commission.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
22. Offices and Meetings
• District must establish District
administrative office and publish notice of
location of meeting places outside the
District in newspapers.
• Election of President, Vice President,
Treasurer, and Secretary.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
25. State Agencies with Oversight
• Texas Commission on Environmental
Quality
– District Oversight
– Bond Approval
– Rate jurisdiction until September 1, 2014
• Public Utility Commission of Texas
– Rate jurisdiction as of September 1, 2014
• Texas Attorney General
– for Open Government and Records Issues
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
26. Open Meetings Act
• Chapter 551, Texas Government Code
• Attorney General Approved Training Required
• Open Meetings Made Easy
• Open Meetings Act Handbook
• Training Required Upon Assumption of Office
• https://www.oag.state.tx.us/open/publications_og.shtml
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
27. Open Meetings
• 72 Hours Notice of meeting (unless
emergency)
• Notice must state time, date and place of
meeting
• Notice must describe matters to be
discussed sufficiently
• Public has right to attend
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
28. Open Meetings
Closed Sessions
•
•
•
•
•
Consult with District’s attorney
Real Property Acquisition
Personnel Matters
Gifts to District
Other Exceptions
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
29. Public Information Act
• Chapter 552, Texas Government Code
– formerly the Open Records Act
• Attorney General Training Required
• Open Records Made Easy
• Public Information Act Handbook
• Training Required Upon Assumption of Office
•
https://www.oag.state.tx.us/open/publications_og.shtml
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
30. Public Information
• Districts and “the part, section, or portion of
an organization, corporation, commission,
committee, institution, or agency that spends
or that is supported in whole or in part by
public funds “ are subject to the act.
• Non-profit WSCs specifically subject to the
act.
• Unless excluded, all public information is
subject to disclosure under the act.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
31. Public Information
• Making a Request
– A request for records or information triggers
the Act.
• Creating Records to Respond to Request
– The Act does not require a governmental
body to create new information, to do legal
research, or to answer questions.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
32. Public Information
• Charges to the Requestor
– Generally no charges allowed to view or
inspect records and information. Charges
may be allowed for copies and certain staff
time.
• Amount of Charges
– All charges must comply with the Texas
Building and Procurement Commission’s
rules.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
33. Public Information
• Exceptions to the Act
– the governmental body generally must,
refer the matter to the Office
of the Attorney General (the OAG) for a ruling.
• Questions or Complaints. (877) 673-6839
(877-OPEN TEX).
• Complaints Regarding Charges. Contact the
Texas Building and Procurement Commission
(512) 475-2497.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
34. Ethical Issues
• Conflict of Interest
• Nepotism
• Dual Office Holding/Incompatibility
AG Handbook: Public Officers: Traps for the Unwary
https://www.oag.state.tx.us/open/publications_og.shtml
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
35. Conflict of Interest
• Common Law
If a public official directly or indirectly has a pecuniary
interest in a contract, no matter how honest he may be,
and although he may not be influenced by the interest,
such a contract so made is violative of the spirit and
letter of our law, and is against public policy. Meyers v.
Walker
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
36. Conflict of Interest
• A local public official commits an offense if the
official knowingly:
– violates Local Government Code Section 171.004
(Next Slide)
– acts as surety for a business entity that has work,
business, or a contract with the governmental entity; or
– acts as surety on any official bond required of an
officer of the governmental entity.
• An offense under this section is a Class A
misdemeanor – punishable by up to 1 year in jail
and/or up to $4000 penalty.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
37. Conflict of Interest
• If a local public official has a substantial interest
in a business entity or in real property, the
official must:
– file an affidavit stating the nature and extent of the
interest before a vote or decision on any matter
involving the business entity or the real property, and
– abstain from further participation in the matter if:
• the action on the matter will have a special economic
effect on that business entity that is distinguishable from
the effect on the public; or
• it is reasonably foreseeable that an action on the matter
will have a special economic effect on the value of the
property that is distinguishable from its effect on the Road, Suite 200
2705 Bee Cave
Austin, Texas 78746
public.
(512) 614-0901
www.carltonlawaustin.com
©2013
38. Conflict of Interest
• A person has a substantial interest in a business
entity if:
– the person owns 10 percent or more of the voting stock or
shares of the business entity or owns either 10 percent or
more or $15,000 or more of the fair market value of the
business entity; or
– funds received by the person from the business entity
exceed 10 percent of the person's gross income for the
previous year.
• A person has a substantial interest in real property if
the interest is an equitable or legal ownership with a
fair market value of $2,500 or more.
• Applies to Spouse, Child and Parent Interests Too.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
39. Nepotism
• A public official may not appoint, confirm the
appointment of, or vote for the appointment or
confirmation of the appointment of an individual
to a position that is to be directly or indirectly
compensated from public funds or fees of office
if:
– the individual is related to the public official within a
degree described by Texas Government Code,
Section 573.002; or
– the public official holds the appointment or
confirmation authority as a member of a state or local
board, the legislature, or a court and the individual is
related to another member of that board, legislature, or
court within a degree described by Section 573.002. Suite 200
2705 Bee Cave Road,
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
40. Nepotism
• Except as provided by Texas Government
Code, Section 573.043, this chapter
applies to relationships within the third
degree by consanguinity or within the
second degree by affinity.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
42. Nepotism
Consanguinity
Civil Law Degrees Of Relationship
1st
Officer
2nd
3rd
4th
Child
Grandchild
Great
Grandchild
Great Great
Grandchild
Parent
Sibling
Niece/Nephe
w
Grand
Niece/Nephe
w
Grandparent
Great
Grandparent
Great Great
Grandparent
Aunt/Uncle
Great
Aunt/Uncle
1st Cousin
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
43. Nepotism
Affinity
Civil Law Degrees Of Relationship
1st
Officer
2nd
3rd
Spouse
Spouse’s Sibling
Child of Spouse’s
Sibling
Spouse’s Parent
Spouse’s
Grandparent
Spouse’s Great
Grandparent
Child’s Spouse
Parent of Child’s
Spouse
Grandparent of Child’s
Spouse
Sibling’s Spouse
Parent of Sibling’s
Spouse
Spouse’s Aunt/Uncle
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
44. Dual Office Holding
• Article XVI, Section 40, of the Texas
Constitution prohibits a person from
holding or exercising more than one civil
office of emolument at a time.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
46. Incompatibility
• Self Appointment
– “It is because of the obvious incompatibility of
being both a member of a body making the
appointment and an appointee of that body
that the courts have with great unanimity
throughout the country declared that all
officers who have the appointing power are
disqualified for appointment to the offices to
which they may appoint.”
• Ehlinger v Clark, 8 S.W.2d 666 (Tex. 1928).
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
47. Incompatibility
• Self Employment
– Ordinarily, self-employment incompatibility will
arise only where one position is an office and
the other an employment.
– But, can arise when position is subordinate to
the governing body in some of its principal
duties.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
48. Incompatibility
• Conflicting Loyalties
– both positions must be “offices”
– the relationship between the positions creates
conflict
• if authorized to contract with each other
• if both have the power of taxation
– even if one district imposes an ad valorem property tax and the
other imposes a sales tax that must be approved by the voters.
• if boundaries overlap
• whenever one governmental body has authority to
impose its will on the other in any matter whatsoever.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
50. Revenue
• Ad Valorem Taxes
• Utility Rates
• Fees and Charges
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
51. Ad Valorem Taxes
• Property Tax (Ad Valorem) Limits
– Voter Approved Autority
– Not for SUDs (65.235)
• Truth-in-Taxation Process
– Notice and Hearings if exceed Effective Rate
• Rollback Elections
– 108% of Previous Effective O&M Rate
• http://www.window.state.tx.us/taxinfo/proptax/tnt/
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
52. District Utility Rates
• Governed by Chapter 13 of Texas Water
Code
• Subject to Appellate Jurisdiction of TCEQ
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
53. Fees and Charges
• May adopt and enforce all necessary
,
in addition to taxes, for providing or
making available any district facility or
service.
• May require a
for any services or
facilities furnished and the district may or
may not provide that the deposit will bear
interest.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
54. Fees and Charges
• Impact Fees
– Charge against new development for capital
improvements
– More than 3X the actual and reasonable cost
to tap or connect
• Local Government Code, Chap. 395,
process or TCEQ Approved
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
56. Expenditures
Generally
• District's money may be disbursed only by
check, draft, order, or other instrument that is
signed by at least a majority of the directors.
• Board may adopt resolution allowing the general
manager, treasurer, bookkeeper, or other
employee of the district to sign disbursements.
• Board may allow disbursements of district
money to be transferred by federal reserve wire
system. The board by resolution may allow the
wire transfers to accounts in the name of the
district or accounts not in the name of the
district.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
57. Acquiring Property
• A District is authorized to purchase,
construct, acquire, own, operate,
maintain, repair, improve, or extend
inside and outside its boundaries any and
all land, works, improvements, facilities,
plants, equipment, and appliances
necessary to accomplish the purposes of
its creation or the purposes authorized by
this code or any other law.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
58. Bonds
• A district may issues bonds or notes
secured by a pledge of ad valorem taxes
– The “Pledge” allows a bond holder to force
District to levy tax to make debt payments
• A district must hold an election to
authorize the issuance of bonds or notes.
• Bonds generally approved by TCEQ and
Texas Attorney General
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
59. Notes
• Revenue Notes
– Do not require election
– Pledged solely by revenues of system after
costs to maintain and operate
– Not longer than 3 years unless to:
•
•
•
•
Farmers Home Administration;
United States Department of Agriculture;
Texas Water Development Board; or
North American Development Bank.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
60. Questions?
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
61. Break!
But be back at 3:30!
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
62. Part 2
Contractual Relationships
including wholesale and emergency service
contracts and interlocal agreements, as well as
professional service contracts, including how to
manage those relationships. This session will also
discuss potential pitfalls regarding these
relationships, liability and waivers, and how to
protect the district before signing on the dotted line.
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
63. Contracting
• Districts may enter into contracts for all
types of services.
• Proper procedures must be followed
before entering into contracts.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
64. Governmental Immunity
• Utility Districts enjoy certain immunity from suit
under Texas law that private entities do not.
– Can be liable for property damage, personal injury,
and death caused an employee acting within his scope
of employment while operating a motor-driven vehicle
or equipment and if the employee would be personally
liable according to Texas law; and
– Can be liable for personal injury and death so caused
by a condition or use of tangible personal or real
property if the governmental unit would, were it a
private person, be liable to the claimant according to
Texas law.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
65. Tort Liability
• Utility Districts otherwise immune from
liability for torts.
• Utility District tort claims limited to
$100,000 to single person and $300,000
per occurrence for personal injury or
death and $10,000 per occurrence for
property damage.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
66. Bidding
• A district must publish notice of and
submit to competitive bids an expenditure
of more than $75,000 for one item or
service or more than one of the same or
a similar type of item or service in a fiscal
year.
• A district must solicit bids for contracts
between $25,000 and 75,000 from at
least three bidders.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
67. Bidding - Options
• For Public Works (ie Buildings) – Must
Use Government Code, Chapter 2267,
Contracting and Delivery Procedures for
Construction Projects
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
68. Bidding – Chapter 2267
• Competitive Bidding
• Competitive Sealed Proposals
• Construction Manager-Agent Method
(“CMA”)
• Construction Manager-At-Risk Method
(“CMAR”)
• Design-Build Contracts
• Job Order Method
Government Code Chapter 2267
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
69. Bidding - Prohibitions
• Professional Services Procurement Act
prohibits bidding the following
professional services:
– Accounting
– Architecture
– Landscape architecture
– Land surveying
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
70. Bidding - Prohibitions
• Additional Prohibitions
– Medicine
– Optometry
– Professional engineering
– Real estate appraising
– Professional nursing
• Government Code Chapter 2254
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
71. Bidding – Professional Services
How to secure contracts for architectural,
engineering, and surveying services:
• Select most qualified provider on basis of
demonstrated competence and
qualifications
• Attempt to negotiate contract at fair and
reasonable price
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
72. Bidding – Professional Services
How to secure contracts for architectural,
engineering, and surveying services:
• If negotiations fail:
1) formally end negotiations
2) select next most highly qualified
provider
3) attempt to negotiate contract at fair
and reasonable price
4) continue process until contract is
entered
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
73. Construction Projects
• Payment and Performance Bonds
– A governmental entity making a public work
contract must require the contractor, before
beginning the work, to execute to the
governmental entity:
– a payment bond, if the contract is in excess
of $25,000
– a performance bond where contract is in
excess of $100,000
Government Code Chapter 2253
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
74. Construction Projects
• Prevailing Wage Rates
– District must pay prevailing wage rates for
public work construction contract (not
maintenance)
– Must either:
• Survey wage rates prevailing in the area; or
• Use wage rates determined by US Department of
Labor under Davis-Bacon Act
– Must specify wage rates in bid solicitation and
contract documents
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
76. Audit
• Annual Audit is required within 120 days of fiscal
year end
• Audit must be completed by certified public
accountant (CPA)
• Audit must comply with TCEQ rules
• Exemptions and alternative requirements for
dormant and low revenue districts
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
77. Depositories
• The board shall designate one or more banks
to serve as depositories for district funds.
• The board shall deposit all district funds in a
depository bank, except that the board: (1)
may deposit funds pledged to pay bonds or
notes with banks named in the trust indenture
or in the bond or note resolution; and (2) shall
remit funds for the payment of the principal of
and interest on bonds and notes to the bank
of payment.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
78. Depositories
• The district may not deposit funds in a
depository or trustee bank in an amount that
exceeds the maximum amount secured by the
Federal Deposit Insurance Corporation unless
the excess funds are secured in the manner
provided by law for the security of county
funds. (Currently $250,000)
• The resolution or trust indenture securing the
bonds or notes may require that any or all of
the funds must be secured by obligations of or
unconditionally guaranteed by the federal
government.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
79. Public Funds Investment Act
• Government Code, Chapter 2256
• A District must designate an Investment
Officer
– Training required for Investment Officer
– Six initial hours within a year, then four hours
every two years
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
80. Public Funds Investment Act
• A district must adopt by rule, order,
ordinance, or resolution, as appropriate, a
regarding
the investment of its funds and funds
under its control.
• A district must review its investment
policy and investment strategies not less
than
.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
81. Public Funds Investment Act
• A district must
, by rule,
order, ordinance, or resolution, as
appropriate, one or more officers or
employees of the district as
to be responsible
for the investment of its funds
consistent with the investment policy
adopted by the entity.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
82. Public Funds Investment Act
• Not less than quarterly, the investment
officer shall prepare and submit to the
district a written
for all funds covered by
this chapter for the preceding reporting
period.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
83. Public Funds Collateral Act
• Government Code, Chapter 2257
• A deposit of public funds shall be secured
by eligible security to the extent and in
the manner required by Chapter 2257.
• A public entity may contract with a bank
that has its main office or a branch office
in Texas to secure a deposit of public
funds.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
84. Other Service Contracts for
Districts
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
85. Contracts for Other Services
•
•
•
•
•
Contract for Insurance and Director Bonds
Contract for bookkeeping services.
Contract for general legal services.
Contract for audit services.
Contract for Tax Assessment and Collection
services.
• Purchasing Agreements with Cooperatives.
(i.e. HGAC, Buy Board, State)
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
86. Miscellaneous Financial Issues
• Adopt Resolution Establishing District
Fiscal Year
• Establish District Depository
• Open District bank account(s), and
investment account(s)
• Adopt Investment Policy
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
87. Reporting and Registrations
• Register/File Report with TCEQ annually
• Obtain a federal tax identification number
for the District
• Obtain a taxing unit identification number
from the Texas Comptroller
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
88. Utility Issues
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
89. Service Area
• Districts NOT required to have CCN
– May consider obtaining CCN to proactively
secure/defend service area
• CCN obligates the District to serve area
and gives TCEQ oversight of how service
is provided
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
90. CCN Issues
• Expedited Release
– 50 acres or more and no service
• Streamlined Expedited Release
– 25 acres or more in 33 counties and no service
• Decertification
– Refusal to provide service
• What is “service” and how can you provide it?
– Contracts with landowners are key
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
91. Rates
• Districts may set rates and fees to recover costs
of providing services
• Changes in rates subject to appeal to TCEQ
– Lesser of 10% or 10,000 of affected ratepayers file
petition within 90 days of final decision
– Wholesale customers may appeal within 90 days as
well.
– Rates must be just and reasonable and sufficient,
equitable, and consistent in application to each class
of customers.
– Rates may not be unreasonably preferential,
prejudicial, or discriminatory.
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
92. Wholesale Contracts
• Contracts for wholesale water supply
from another entity
• Limited appellate right to TCEQ regarding
rates
– Public Interest Test Barrier
– Some options for Districts contracting with
Cities
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
93. Wholesale Contracts
• Important to protect District through contract
language (whether supplier or recipient of water)
– Clearly identify method for calculating rates, both
calculation and process
– Clarify whether supplier may unilaterally increase rates
– Clarify options for other sources of water supply
• TCEQ will not decide disputes about contract
language
• Contract enforcement will be in District Court,
not TCEQ
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
94. Organizations/Agencies for
Assistance
• Texas Attorney General (Open
Government)
• Texas Commission on Environmental
Quality (Rate, Fees and Bonds)
• State Library and Archives Commission
(Records)
• Texas Comptroller (Sales Tax)
• Texas Secretary of State (Elections)
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
95. Helpful Websites
• TX Rural Water Association
– www.trwa.org
• TCEQ
– www.tceq.texas.gov
• PUC
– www.puc.texas.gov
• Texas Attorney General
– www.oag.state.tx.us
• Texas Comptroller of Public Accounts
– www.window.state.tx.us
• Texas Secretary of State
– www.soc.state.tx.us
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013
96. Questions?
2705 Bee Cave Road, Suite 200
110
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2011
©2013
97. Districts: Back to Basics
John J. Carlton
The Carlton Law Firm, PLLC
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
john@carltonlawaustin.com
2705 Bee Cave Road, Suite 200
Austin, Texas 78746
(512) 614-0901
www.carltonlawaustin.com
©2013