Relating to the projects undertaken by a public improvement district, municipal management district, water control and improvement district, fresh water supply district, or municipal utility district, the official text

H.B. No. 4370

AN ACT

relating to the projects undertaken by a public improvement

district, municipal management district, water control and

improvement district, fresh water supply district, or municipal

utility district.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Section 372.003, Local Government Code, is

amended by amending Subsection (b) and adding Subsection (b-2) to

read as follows:

(b) A public improvement project may include:

(1) landscaping;

(2) erection of fountains, distinctive lighting, and

signs;

(3) acquiring, constructing, improving, widening,

narrowing, closing, or rerouting of sidewalks or of streets, any

other roadways, or their rights-of-way;

(4) construction or improvement of pedestrian malls;

(5) acquisition and installation of pieces of art;

(6) acquisition, construction, or improvement of

libraries;

(7) acquisition, construction, or improvement of

off-street parking facilities;

(8) acquisition, construction, improvement, or

rerouting of mass transportation facilities;

(9) acquisition, construction, or improvement of

water, geothermal water conveyance, wastewater, or drainage

facilities or improvements;

(10) the establishment or improvement of parks;

(11) projects similar to those listed in Subdivisions

(1)-(10);

(12) acquisition, by purchase or otherwise, of real

property in connection with an authorized improvement;

(13) special supplemental services for improvement

and promotion of the district, including services relating to

advertising, promotion, health and sanitation, water and

wastewater, public safety, security, business recruitment,

development, recreation, and cultural enhancement;

(14) payment of expenses incurred in the

establishment, administration, and operation of the district; and

(15) the development, rehabilitation, or expansion of

affordable housing.

(b-2) Payment of expenses under Subsection (b)(9) may also

include expenses related to the operation and maintenance of a

geothermal water conveyance facility or improvement.

SECTION 2. Section 372.023(a), Local Government Code, is

amended to read as follows:

(a) Costs of improvements may be paid or reimbursed by any

combination of the methods described by this section if the

improvements are dedicated, conveyed, leased, or otherwise

provided to or for the benefit of:

(1) a municipality or county;

(2) a political subdivision or other entity exercising

the powers granted under this subchapter as authorized by other

law; [or]

(3) an entity that:

(A) is approved by the governing body of an

entity described by Subdivision (1) or (2); and

(B) is authorized by order, ordinance,

resolution, or other official action to act for an entity described

by Subdivision (1) or (2); or

(4) an entity subject to the regulatory jurisdiction

of the Public Utility Commission of Texas.

SECTION 3. Section 375.093(c), Local Government Code, is

amended to read as follows:

(c) If a district, in exercising any of the powers conferred

by this chapter, requires the relocation, adjustment, raising,

lowering, rerouting, or changing the grade of or altering the

construction of any street, alley, highway, overpass, underpass, or

road, any railroad track, bridge, or other facilities or property,

any electric lines, conduits, or other facilities or property, any

telephone or telegraph lines, conduits, or other facilities or

property, any gas transmission or distribution pipes, pipelines,

mains, or other facilities or property, any water, geothermal water

conveyance, sanitary sewer or storm sewer pipes, pipelines, mains,

or other facilities, or property, any cable television lines,

cables, conduits, or other facilities or property, or any other

pipelines and any facilities or properties relating to those

pipelines, those relocations, adjustments, raising, lowering,

rerouting, or changing of grade, or altering of construction must

be accomplished at the sole cost and expense of the district, and

damages that are suffered by the owners of the property or

facilities shall be borne by the district.

SECTION 4. Section 375.112(a), Local Government Code, is

amended to read as follows:

(a) An improvement project or services provided by the

district may include the construction, acquisition, improvement,

relocation, operation, maintenance, or provision of:

(1) landscaping; lighting, banners, and signs;

streets and sidewalks; pedestrian skywalks, crosswalks, and

tunnels; seawalls; marinas; drainage and navigation improvements;

pedestrian malls; solid waste, water, sewer, and power facilities,

including electrical, gas, steam, cogeneration, and chilled water

facilities and geothermal water conveyance facilities or

improvements; parks, plazas, lakes, rivers, bayous, ponds, and

recreation and scenic areas; historic areas; fountains; works of

art; off-street parking facilities, bus terminals, heliports, and

mass transit systems; theatres, studios, exhibition halls,

production facilities and ancillary facilities in support of the

foregoing; and the cost of any demolition in connection with

providing any of the improvement projects;

(2) other improvements similar to those described in

Subdivision (1);

(3) the acquisition of real property or any interest

in real property in connection with an improvement, project, or

services authorized by this chapter, Chapter 54, Water Code, or

Chapter 365 or 441, Transportation Code;

(4) special supplemental services for advertising,

economic development, promoting the area in the district, health

and sanitation, public safety, maintenance, security, business

recruitment, development, elimination or relief of traffic

congestion, recreation, and cultural enhancement; and

(5) expenses incurred in the establishment,

administration, maintenance, and operation of the district or any

of its improvements, projects, or services.

SECTION 5. Section 51.121(b), Water Code, is amended to

read as follows:

(b) A water control and improvement district organized

under the provisions of Article XVI, Section 59, of the Texas

Constitution, may provide for:

(1) the control, storage, preservation, and

distribution of its water and floodwater and the water of its rivers

and streams for irrigation, power, and all other useful purposes;

(2) the reclamation and irrigation of its arid,

semiarid, and other land which needs irrigation;

(3) the reclamation, drainage, conservation, and

development of its forests, water, and hydroelectric power;

(4) the navigation of its coastal and inland water;

(5) the control, abatement, and change of any shortage

or harmful excess of water;

(6) the protection, preservation, and restoration of

the purity and sanitary condition of water within the state; and

(7) the preservation and conservation of all natural

resources of the state, including through the use of geothermal

water conveyance systems for the conservation of natural resources.

SECTION 6. Section 51.125, Water Code, is amended to read as

follows:

Sec. 51.125. CONSTRUCTION OF IMPROVEMENTS. A district may

construct all works and improvements necessary:

(1) for the prevention of floods;

(2) for the irrigation of land in the district;

(3) for the drainage of land in the district,

including drainage ditches or other facilities for drainage;

(4) for the construction of levees to protect the land

in the district from overflow;

(5) to alter land elevations where correction is

needed; [and]

(6) to supply water for municipal uses, domestic uses,

power and commercial purposes, and all other beneficial uses or

controls; and

(7) for the construction of geothermal water

conveyance systems necessary for the conservation of natural

resources.

SECTION 7. Subchapter D, Chapter 53, Water Code, is amended

by adding Section 53.123 to read as follows:

Sec. 53.123. GEOTHERMAL WATER CONVEYANCE SYSTEMS. A

district may purchase, construct, acquire, own, operate, repair,

improve, and extend geothermal water conveyance systems in the

district.

SECTION 8. Section 53.182, Water Code, is amended by adding

Subsection (d) to read as follows:

(d) For the purposes of Section 53.123, a district may issue

bonds payable from ad valorem taxes, revenues, or a combination

thereof.

SECTION 9. Section 54.012, Water Code, is amended to read as

follows:

Sec. 54.012. PURPOSES OF A DISTRICT. A district shall be

created for the following purposes:

(1) the control, storage, preservation, and

distribution of its storm water and floodwater, the water of its

rivers and streams for irrigation, power, and all other useful

purposes;

(2) the reclamation and irrigation of its arid,

semiarid, and other land needing irrigation;

(3) the reclamation and drainage of its overflowed

land and other land needing drainage;

(4) the conservation and development of its forests,

water, and hydroelectric power;

(5) the navigation of its inland and coastal water;

(6) the control, abatement, and change of any shortage

or harmful excess of water;

(7) the protection, preservation, and restoration of

the purity and sanitary condition of water within the state; and

(8) the preservation of all natural resources of the

state, including through the use of geothermal water conveyance

systems for the preservation of natural resources.

SECTION 10. Section 54.501, Water Code, is amended to read

as follows:

Sec. 54.501. ISSUANCE OF BONDS. The district may issue its

bonds for any purpose authorized by this chapter, Chapter 49, or

other applicable laws, including the purpose of purchasing,

constructing, acquiring, owning, operating, repairing, improving,

or extending any district works, improvements, facilities, plants,

equipment, and appliances needed to accomplish the purposes set

forth in Section 54.012 for which a district shall be created,

including works, improvements, facilities, plants, equipment, and

appliances needed to provide a waterworks system, sanitary sewer

system, storm sewer system, geothermal water conveyance system, and

solid waste disposal system.

SECTION 11. This Act takes effect September 1, 2025.

______________________________
______________________________

President of the Senate
Speaker of the House

I certify that H.B. No. 4370 was passed by the House on May

14, 2025, by the following vote: Yeas 138, Nays 0, 2 present, not

voting.

______________________________

Chief Clerk of the House

I certify that H.B. No. 4370 was passed by the Senate on May

21, 2025, by the following vote: Yeas 31, Nays 0.

______________________________

Secretary of the Senate

APPROVED: _____________________

Date

_____________________

Governor