H.B. No. 1318 amends the Water Code to streamline the process for municipalities seeking a certificate of public convenience and necessity to provide water or sewer services in areas they have incorporated or annexed. The bill specifies that the utility commission will grant single certification to the municipality and will determine adequate and just compensation for any property transferred from a retail public utility. Notably, the bill removes previous language that required the commission to assess compensation for property deemed useless or valueless due to the certification. Instead, it emphasizes compensation for both transferred property and any remaining property that may be damaged or adversely affected.

Additionally, the bill outlines the process for municipalities to take possession of property pending appeal, provided they pay the established compensation. It also clarifies that if a municipality files for certification on behalf of a franchised utility, both the municipality and the franchised utility must be involved in the application and responsible for compensation payments. The changes will apply only to proceedings that commence after the bill's effective date of September 1, 2025, ensuring that existing proceedings are governed by the law in effect at the time they began.

Statutes affected:
Introduced: Water Code 13.255 (Water Code 13)
House Committee Report: Water Code 13.255 (Water Code 13)