HBA-JLV H.B. 3286 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 3286 By: Lewis, Ron Natural Resources 3/19/2001 Introduced BACKGROUND AND PURPOSE Current law permits state and local governments, school districts, and institutions of higher education to enter into performance contracts for energy conservation projects, but does not specifically extend this to water conservation projects. In a performance contract, a company enters into an agreement with an entity such as a school district and provides up front capital to pay for improvements that will result in reduced energy or water use. The company is reimbursed out of the revenue stream based on conservation savings. The benefit is that conservation improvements can be done without having to issue debt instruments. House Bill 3286 authorizes state and local entities, school districts and institutions of higher education to enter into a performance contract for water conservation measures to reduce water consumption. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the state energy conservation office in SECTION 10 (Section 447.002, Government Code) of this bill. ANALYSIS House Bill 3286 amends the Education, Local Government, and Government codes to authorize state entities, the governing body of local governments, the boards of trustees of school districts, and the governing board of institutions of higher education to enter into contracts for water conservation measures to reduce water consumption. The bill sets forth provisions identifying the types of contracts the entities are authorized to enter (Secs. 44.901 and 51.927, Education Code), (Secs. 302.001-301.004, Local Government Code), (Secs. 2166.402 and 2166.406, Government Code). The bill requires the Texas Water Development Board to assist the governing body of a state agency, commission, or institution in preparing water conservation standards by providing technical assistance and advice (Sec. 2166.402, Government Code). The bill changes the name of the energy management center to the state energy conservation office (office) and sets forth provisions enumerating the powers and duties of the office and authorizes the office to establish rules relating to the adoption and implementation of water conservation programs. The bill requires the office to coordinate all water conservation related activities with the Texas Water Development Board. The Texas Water Development Board is required to evaluate and help develop all proposed water conservation and reuse requirements and to provide training and expertise to the office staff regarding water conservation issues (Secs. 447.001-447.011, Government Code). The bill removes provisions requiring the office to administer state programs established under the National Energy Extension Service Act (Sec. 447.003, Government Code). EFFECTIVE DATE September 1, 2001.