Relating to impact and production fees for certain water projects and to the regulation of certain wells; authorizing a fee, the official text

S.B. No. 1253

AN ACT

relating to impact and production fees for certain water projects

and to the regulation of certain wells; authorizing a fee.

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

SECTION 1. Subchapter B, Chapter 395, Local Government

Code, is amended by adding Section 395.0231 to read as follows:

Sec. 395.0231. CONSERVATION AND REUSE CREDITS AGAINST WATER

AND WASTEWATER FEES. (a) A political subdivision shall provide a

credit against water and wastewater impact fees otherwise assessed

to a development to a builder or developer for the construction,

contribution, or dedication of an eligible facility, system, or

product that results in water reuse, conservation, or savings.

(b) A facility, system, or product eligible for a credit

under this section includes a facility, system, or product that:

(1) reduces per service unit water consumption, supply

requirements, or necessary treatment and distribution

infrastructure per service unit;

(2) decreases the need of wastewater collection and

treatment facilities per service unit;

(3) diminishes the demand for stormwater and drainage

facilities per service unit; or

(4) integrates practices or technologies that achieve

water efficiency, reuse, or conservation performance that exceed

standard compliance requirements.

(c) A political subdivision that provides a credit under

this section shall establish procedures for:

(1) calculating and applying the credits in a fair and

consistent manner; and

(2) reviewing and approving credits under this

section.

SECTION 2. Section 8843.152, Special District Local Laws

Code, is amended to read as follows:

Sec. 8843.152. SERVICE CONNECTION FEE AND PRODUCTION FEE.

(a) This section does not apply to a water utility that has surface

water as its sole source of water.

(b) The district may levy and collect a water utility

service connection fee not to exceed $1,000 for each new water

service connection made after September 1, 2013.

(c) The district may assess a production fee as provided by

Section 36.205, Water Code. Subject to Subsection (d), a fee

assessed under this subsection may not exceed 30 cents per 1,000

gallons.

(d) Beginning January 1, 2026, and continuing on January 1

of each subsequent year, the maximum amount of the fee described by

Subsection (c) increases by five percent from the previous year's

maximum amount.

(e) The district may provide a credit against a service

connection fee otherwise assessed to a water utility that is also

assessed a production fee under this section for the construction,

contribution, or dedication of an eligible facility, system, or

product that results in water reuse, conservation, or savings as

described under Section 395.0231(b), Local Government Code.

SECTION 3. Section 8843.104, Special District Local Laws

Code, is repealed.

SECTION 4. This Act takes effect September 1, 2025.

______________________________
______________________________

President of the Senate
Speaker of the House

I hereby certify that S.B. No. 1253 passed the Senate on

March 27, 2025, by the following vote: Yeas 30, Nays 0; and that

the Senate concurred in House amendments on May 26, 2025, by the

following vote: Yeas 30, Nays 1.

______________________________

Secretary of the Senate

I hereby certify that S.B. No. 1253 passed the House, with

amendments, on May 21, 2025, by the following vote: Yeas 112,

Nays 28, two present not voting.

______________________________

Chief Clerk of the House

Approved:

______________________________

Date

______________________________

Governor