S.B. No. 740 amends various sections of the Water Code to enhance the regulatory framework for water and sewer services in Texas. Key changes include redefining "political subdivision" to specifically include municipalities, river authorities, water districts, and other special purpose districts, while removing references to incorporated cities, towns, or villages. The bill clarifies the Public Utility Commission's jurisdiction over wholesale water services provided by municipalities to other political subdivisions, excluding other municipalities. Additionally, it introduces a new definition for "public utility agency" and establishes that municipalities' decisions regarding wholesale water or sewer services to other municipalities are exempt from certain regulatory provisions.

The bill also outlines a more efficient process for the Public Utility Commission to approve system improvement charges, requiring a final order within 60 days of a complete application, with provisions for extensions. It mandates that the commission adopt rules to streamline the acquisition processes for utilities in receivership or supervision, allowing various entities, including municipalities and public utility agencies, to manage these utilities. Furthermore, the bill emphasizes the need for transparency and documentation in applications for system improvement charges, ensuring that the Office of Public Utility Counsel can review and comment on these applications. The act is set to take effect on September 1, 2025.

Statutes affected:
Introduced: Water Code 13.183, Water Code 13.301, Water Code 13.412, Water Code 13.4132 (Water Code 13)
Senate Committee Report: Water Code 13.183, Water Code 13.301, Water Code 13.412, Water Code 13.4132 (Water Code 13)
Engrossed: Water Code 13.002, Water Code 13.183, Water Code 13.301, Water Code 13.412, Water Code 13.4132 (Water Code 13)
House Committee Report: Water Code 13.002, Water Code 13.183, Water Code 13.301, Water Code 13.412, Water Code 13.4132 (Water Code 13)
Enrolled: Water Code 12.013, Water Code 13.002, Water Code 13.043, Water Code 13.183, Water Code 13.301, Water Code 13.412, Water Code 13.4132 (Water Code 13, Water Code 12)