Sec. 11010.005. METHOD OF ADDING SPONSORS. (a) The governing body of a local government or a private entity, including a water supply corporation, may petition the board to add that local government or private entity as a sponsor.

(b) A petition under Subsection (a) must be submitted in the manner and form required by board rule.

(c) On receipt of a petition under Subsection (a), the board shall set a hearing on the petition and provide notice of the date, time, place, and purpose of the hearing to:

(1) the sponsors of the authority; and

(2) the petitioning local government or private entity.

(d) At the hearing, the board shall determine whether:

(1) the local government or private entity will benefit from being added to the authority as a sponsor; and

(2) it is in the best interest of the authority to add the local government or private entity to the authority as a sponsor.

(e) If, after a hearing on the petition, the board determines that the local government or private entity should be added to the authority as a sponsor, the board shall issue an order:

(1) adding the local government or private entity to the authority;

(2) adding the local government's or private entity's territory or service area to the territory of the authority;

(3) making the local government's or private entity's territory or service area subject to the privileges, duties, assets, and financial obligations of the authority to the same degree as other sponsors already included in the authority; and

(4) stating the proposed effective date of the order.

(f) An order issued under Subsection (e) takes effect on the proposed effective date except as otherwise provided by this section. If the subject of the order is a local government, the proposed effective date must allow enough time for the local government to comply with Subsections (g) and (h).

(g) A local government that is the subject of an order issued under Subsection (e) shall publish notice of the authority's proposal to add the local government to the authority as a sponsor. The notice must:

(1) be published in a newspaper of general circulation in the county in which the local government is located;

(2) be published at least once per week for two consecutive weeks and with the first publication appearing on or before the 14th day before the proposed effective date of the order;

(3) state the proposed effective date of the order adding the local government to the authority as a sponsor; and

(4) include information regarding the right of the local government's voters to petition the governing body of the local government to call an election on the question of authorizing the addition of the local government to the authority as a sponsor and the method of making the petition.

(h) If the governing body of the local government, before the proposed effective date of the order, receives a petition calling for an election on the question of authorizing the addition of the local government to the authority as a sponsor that is signed by at least 10 percent of the local government's registered voters, the governing body shall order a special election on the question. Section 41.001(a), Election Code, does not apply to an election ordered under this subsection.

(i) On receipt of a qualifying petition under Subsection (h), the effective date of the order issued under Subsection (e) is suspended until after the date of the election and the governing body of the local government shall notify the board of the petition and suspension.

(j) If a majority of voters voting in an election held under this section vote in favor of the addition of the local government to the authority as a sponsor, the order issued under Subsection (e) takes effect on the date the result is declared. If a majority of voters voting in the election vote against the addition of the local government to the authority as a sponsor, the order issued under Subsection (e) is ineffective.

Added by Acts 2017, 85th Leg., R.S., Ch. 806 (S.B. 1198), Sec. 2, eff. June 15, 2017.