The bill amends the Water Code to enhance the regulatory authority's considerations when approving rates for water or sewer utility services. Specifically, it requires the regulatory authority to take into account whether the utility is in compliance with the rules set by the Texas Commission on Environmental Quality, alongside other factors such as the utility's conservation efforts, service quality, operational efficiency, and management quality. This is reflected in the insertion of new language in Section 13.184(b).

Additionally, the bill introduces a new subsection (g-1) to Section 13.185, which mandates that when evaluating a utility's historic test year information for determining reasonable expenses, the regulatory authority must also consider the utility's compliance with commission rules during that test year. The changes will apply only to rate proceedings that commence on or after the effective date of the Act, which is set for September 1, 2025.

Statutes affected:
Introduced: Water Code 13.184, Water Code 13.185 (Water Code 13)