Quench 2022 - Issue 2

WATER RESOURCE DEVELOPMENT IN TEXAS

RURALWATERCON 2022 IN PHOTOS

ADOPTING SOUND FINANCIAL POLICIES

Issue 2 2022 www.tr wa.org

TRWA Today Established in 1969, the Texas Rural Water Association (TRWA) is a statewide nonprofit trade association with an active membership consisting of over 750 nonprofit water supply corporations, water districts, small-town water departments and investor-owned utilities. In addition, more than 200 water industry suppliers participate in TRWA activities as associate members. TRWA members provide water and wastewater service to 3 million customers throughout Texas.

TRWA is dedicated to helping directors, managers, operators and office professionals provide efficient service and clean, safe drinking water to their customers. Through on-site technical assistance, education and information exchange, TRWA helps its members better meet their needs as well as the needs of their customers.

BOARD OF DIRECTORS OFFICERS President Bruce Alexander Medina (District 2) Vice-President Robert Nettles Walker (District 13) Secretary Mark Gardenhire Shackelford (District 1) Treasurer Steve Adams Brown (District 4) Immediate Past President Chris Boyd Denton (District 3)

DISTRICT DIRECTORS Dave McMurry Bastrop (District 5) Brian Macmanus Cameron (District 6) Allen Knight North Collin (District 7) Charles Beseda Hill (District 8) Pat Allen Guadalupe (District 9) Kent Watson Brazos (District 10) Rachel Webb South Rains (District 11) Paula Weber Kaufman (District 12) Matthew Barrett Swift (District 14)

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Main Office Line

TRWA STAFF

(512) 472-8951

LEADERSHIP TEAM Lara Zent Larry Bell Nichol Everingham Jason Knobloch Tom Shephard, CPA

Executive Director & General Counsel Technical Assistance Director Professional Development & Training Director Environmental Services Director Finance Director

ext. 101 ext 138 ext. 134 ext. 137 ext. 102

OFFICE STAFF Melody Bennett Eric Betts Pam Cantrell Haley Dixon Lisa Gallo Chelsea Gomez Miles Hartman Deborah McMullan Kayla Mitchell Sonya Stocklin Ariane Walker Emily Young

Project Support Specialist Communications Manager Accounting Support Specialist Apprenticeship Program Manager Meeting and Event Planner Training Development Specialist Course Development Specialist Membership and Outreach Manager Paralegal Receptionist Training Manager Assistant Environmental Services Director

ext. 130 ext. 115 ext. 139 ext. 107 ext. 105 ext. 103 ext. 135 ext. 108 ext. 321 ext. 104 ext. 111 ext. 132

FIELD STAFF Thomas Acker, Jr. Nathan Cantrell Alex Eaves Roel Gonzalez Justin Guerra Paul King Charles Perkins Bruce Pearson James Smith Donnie Stanton Quentin Turner Jewel Uzquiano William White Scott Willeford James Wallingsford Gilbert Ybarbo

Instructor Wastewater Technician Wastewater Technician FMT Specialist Member Services Specialist Circuit Rider Circuit Rider Instructor Circuit Rider FMT Specialist FMT Specialist Source Water Protection Specialist Assistant Technical Assistance Director FMT Specialist FMT Specialist FMT Specialist

cell: (512) 751-6337 cell: (512) 924-7158 cell: (512) 964-7203 cell: (512) 923-5812 cell: (512) 317-8992 cell: (512) 913-9753 cell: (512) 964-2108 cell: (512) 922-4942 cell: (512) 964-9234 cell: (512) 774-9455 cell: (512) 517-9889 cell: (512) 354-0506 cell: (512) 924-4233 cell: (512) 657-8813 cell: (512) 865-8809 cell: (512) 317-2003

In Every Issue

From the Field

Letter from the President .........4

The Future Is Now............18

Letter from the Executive Director ........5

Water resource development is entering a new phase in Texas.

What's your utility doing to keep up?

Keep it Legal .........6

Know Before You Grow..........22

Answers to your legal questions

Ask Larry .........8

The Texas Water Development Board is making it easy for small systems to invest in asset management.

Answers to your technical questions

TRWA Briefs .........28

Small pieces of association news

The Months Ahead .........31

TRWA’s Calendar of Events

Features

TRWA News

Make It A Policy...26

TRWA at the Rural Water Rally in DC....10

For boards, adopting sound financial policies now can make governing your utility easier for years.

Representatives from TRWA's board, staff, and membership visited the nation's capital for the Rural Water Rally in March.

RuralWaterCon 2022 Highlights....12

See photos from our annual convention.

Awards of Excellence Winners......14

Celebrate the winners of TRWA's 2022 Awards of Excellence.

New Board Members.....17

on the cover:

A friendly neighborhood water tower under partly cloudy skies

Meet the new district directors and officers of your TRWA Board of Directors.

Welcome TRWA's New Staff.....26

TRWA has added three new staff members to help us assist our membership.

CONTACT THE EDITOR

photo by Michael Beadnell

Editorial and advertising inquiries may be sent to Eric Betts in the Communications Department at editor@trwa.org.

Quench — 2022 —Issue 2 3

President's Message Hello to everyone involved in Texas Rural Water!

Thank you all for the opportunity to become your new TRWA President for 2022-2023. This year marks my 40th year working with rural utilities, with more than 38 of those years spent as a licensed water and wastewater operator. I started in a small city on the end of a shovel and ended up as the Director of Public Works before moving on to manage East Medina County SUD for the past 14 years. I joined the TRWA Board of Directors in 2014 as the District 2 Director and soon became an active and outspoken advocate for TRWA at the local, state and national level.

For those of you that don't know me, let me say that I am all in when it comes to the support of TRWA and the needs of our rural community. It is my intent as your new President to make as many TRWA events as possible over the next two years. I look forward to meeting as many of you as I can through training opportunities, meetings and events to get your perspective on what it means to be a member of TRWA. I welcome the opportunity for everyone to share their thoughts and opinions on any issues of concern they have about rural water. An open line of communication with members results in an organization that's better able to meet their needs.

TRWA has a great group of folks that serve as directors for each of the 14 member districts throughout the state. In addition to their duties as a TRWA Director, each of these individuals also 4 Quench — 2022 — Issue 2

manages a rural water system. I ask that you get to know your director through personal contact and/ or at district meetings and share your thoughts and opinions on issues facing TRWA, rural water and rural Texas with them. Please reach out to the TRWA office if you need help contacting the director for your area of the state, or visit trwa.org/board to find a list of directors and map of the districts.

The Board of Directors work together to provide direction and guidance to our Executive Director Lara Zent in leading the staff and operations of the association. Please reach out to Lara or a member of her team if you need additional information on the services available to you as a member system or have any issues of concern about the association.

Working together, TRWA will continue to provide a strong voice in support of rural water issues in the state of Texas.

I appreciate the opportunity to serve as the President of TRWA.

Be safe,

Bruce Alexander President TRWA

Letter from the TRWA Executive Director Dear TRWA Members, It was wonderful to see so many of you this April at RuralWaterCon 2022. We had a great time putting on sessions and events for our rural water and wastewater community, raising money for the PAC with auctions and fundraisers and taking advantage of everything Round Rock and the Kalahari Resorts had to offer, from baseball to bowling. We hope you took as much away from attending convention as we did from having you all there with us.

fiscal policies.

You'll find highlights from RuralWaterCon in the pages of this magazine, including photos, this year's Awards of Excellence winners and an introduction to our 20222023 Board of Directors.

Stay tuned to our website and Pipeline e-newsletters for more information on everything TRWA has going on as we head into the summer months.

This issue of Quench is focused on planning. We're excited to have Texas Water Development Board’s Kathleen Jackson writing about the Board's Asset Management Program for Small Systems, which can help qualifying utilities prepare for the future by providing funding to map their system and track their equipment. We also have articles on water resource development and how boards can improve their financial planning by adopting

We're gearing up for our two remaining conferences of the year! First is our Training & Technical Conference in Galveston on July 13-14, where we'll blend education, networking, and fun events. Registration for the 2022 conference opens online April 28 at trwa.org/tech22.

Our Office Professionals Conference will be held in San Antonio on October 13-14, and registration will open in August.

Thank you for all your hard work helping provide vital services to rural Texas.

My best,

Lara Zent Executive Director & General Counsel TRWA

Quench — 2022 —Issue 2 5

Keep It Legal Answers to Members’ Questions by TRWA Contract Attorney Kristen Fancher

Q:

How should a Water Supply Corporation handle usage by the local fire department?

documents and fees owed under the tariff or rate order: • Reconnects where service has previously been provided to the property should be done within one business day, except for good cause shown if this time frame cannot be met;

A: Section 67.0105 of the Texas Water Code authorizes a WSC to enter into a contract related to accounting for • Service to a new tap that does not require a line water used for fire suppression purposes. Most water extension, construction or new facilities should utilities do not charge the fire department for the water be completed within five business days; and used for fire suppression purposes.

• If a line extension or other construction is required It would therefore be a good idea to enter into a contract that will take longer than 30 days, the utility must with the fire department under this authority (whether provide a written explanation of the constructhrough a city or a volunteer fire department) that diction required and an expected date of service. tates that free water will be provided for fire suppression purposes, and that all other water usage is required to be The rule states that unless good cause is shown (e.g., materipaid for, assuming that is how the WSC Board would like als shortages), the utility must provide service within 30 days to handle the matter. These contracts will also usually ad- from the expected date of service or within six months/180 dress how the fire department will report all water usage days from the date of receipt of a completed application. A to the WSC so that the WSC has this information to make failure to provide service within these time frames can result sure the fire department usage is not being accounted for in penalties and/or loss of Certificate of Convenience and in its water loss calculations.

Necessity (CCN) service area, but again, issues such as materials shortages or circumstances beyond the control of the utility are likely to qualify as the “good cause shown” How soon must a utility provide exception in the rule. While there are many PUCT rules that service upon request? apply only to Investor-Owned Utilities, this particular rule makes clear that it applies to all water utilities, including districts and water supply corporations.

A: The Public Utility Commission of Texas (PUCT) rules, in Section 24.161 of the Texas Administrative Code, state RUSSELL DRILLING CO. that a utility must make service available to a “qualified service applicant…as soon as practical after receiving WATER WELL DRILLING a completed application.” The rule goes on to define a SUBMERSIBLE PUMP SERVICE “qualified service applicant” as one that “has met all of TURBINE PUMP SERVICE the utility’s requirements contained in its tariff, schedule WATER WELL REHAB of rates, or service policies and regulations for extenWATER TREATMENT sion of service.” The rule also provides the following time frames after the utility has received all completed

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Q:

We were converted from a water supply corporation into a water district. Does a district that converted from a WSC have to continue using the same bylaws as when the entity was a WSC?

A: No. Section 49.057(g) of the Texas Water Code provides that districts “may adopt bylaws,” and this permissive language in the statute therefore means that the district is not required to have bylaws. This answer is different for water supply corporations, which are private, non-profit entities and are required to have bylaws under Section 22.102 of the Texas Business Organizations Code.

Code. Any language in a district’s bylaws that conflicts with the law would be invalid. For those WSCs that converted to water districts and continue to use bylaws, you will want to make sure that the bylaws are consistent with the current laws that apply to the water district.

Kristen Fancher has extensive experience in representing clients on water and other legal matters across the state of Texas.

TRWA Members can email legal@trwa.org for their legal inquiries or search the archive at https://www.trwa.org/page/KILHome.

While the law does authorize a water district to have bylaws if your board chooses to do so voluntarily, we recommend that those bylaws be consistent with the law, particularly Chapter 49 of the Texas Water Code and the other chapter of the Texas Water Code that will apply depending on your type of district (e.g., Chapter 65 for SUDs, Chapter 51 for WCIDs), in addition to the Texas Election

Quench — 2022 —Issue 2 7

Ask Larry: Quality on Tap

A Q&A column with TRWA Technical Assistance Director Larry Bell

Q:

I have heard of an 85% Rule but cannot locate it. Where or what is this rule and how does it apply to our rural water system?

A: : This refers to a section of the Texas Commission on Environmental Quality’s (TCEQ) rules. Title 30 of the Texas Administrative Code Section 291.93 requires retail public utilities to address how they are planning to increase their overall system capacity once they have reached 85% of their total capacity – how they plan to keep up with the growth in their system before they are maxed out.

Once a system has reached 85% of its capacity as compared to the most restrictive criteria of the Commission’s minimum capacity requirements in Chapter 290 of the Commission’s rules, Section 291.93 requires the utility to submit a planning report that clearly explains how the utility will provide the expected service demands to the remaining areas within the boundaries of their Certificate of Convenience and Necessity (CCN).

The planning report must be submitted in writing within 90 days after a TCEQ field inspection report finds that the utility has reached 85% capacity and include: a brief description of the overall utility and service area, an analysis of the plant capacity and details on how the utility will provide service to the remaining areas in its CCN including projections of cost and expected design and installation dates for additional facilities.

Utilities may request a waiver of the reporting requirement if they demonstrate that the projected growth of the area will not require the utility to exceed 100% of its current capacity for the next 5 years.

There is a continuing reporting requirement until a system 8 Quench — 2022 — Issue 2

can show that they have addressed the issue and are below 85% of their capacity.

Most systems require growth to pay for growth, meaning developers can be required to help pay the cost of increasing system capacity to meet the demand they are placing on the system.

Q:

How often are we required to post the Notice of Requirement to Comply with the Subdivision Service Extension Policy, and what's the best way to go about this?

A: The Public Utility Commission of Texas rules state that water supply corporations and special utility districts have two options for posting or notifying developers/subdividers of their Requirement to Comply with the Subdivision Service Extension Policy.

The first option, laid out in Texas Administrative Code 24.161(e)(2), is to publish the notice in a newspaper one time per week for two consecutive weeks every two years. Many WSCs and SUDs instead opt to post this newspaper notice every year to make sure there is no gap of time that is longer than two years. The rules also require that the corporation or special utility district provide proof of publication through an affidavit of the publisher of the newspaper that specifies each county in which the newspaper is generally circulated.

The second option is contained in the next sub-section, 24.161(e)(3), and it appears on the face of it to be more difficult for a WSC or SUD to manage. This sub-section states: (3) As an alternative to publication of notice, a corporation or special utility district may demonstrate by any

reasonable means that a developer has been notified of notice is to ensure that you’re using the most up-to-date the requirement to comply with the subdivision service version. This regulation used to fall under the purview of TCEQ, but was transferred to the PUCT approximately extension policy, including: eight years ago. The form must now refer to the PUCT and include that agency’s contact information, and not (A) an agreement executed by the developer; TCEQ’s.

(B) correspondence with the developer that sets forth the subdivision service extension policy; or The correct attachment can be found in the TRWA Sample Tariff for WSCs and Sample District Service Policy, which (C) any other documentation that reasonably establishes were revised when the transfer of authority was made that the developer should be aware of the subdivision maybe eight years ago. If you’ve been using the old one, or just telling the newspaper to publish the same one you service extension policy. always have, you may want to double check and ensure One potential problem with this second method is that that your notice contains the most up-to-date information. it may be tricky to prove that each developer or subdivider was notified before they began their project. Not Larry Bell is TRWA's Technical Assistance Director, all developers or people dividing property contact the with more than 30 years experience at the water system before they purchase property or begin the association. development process. The newspaper option, on the other hand, provides a blanket guarantee.

If you have a Technical Question, please email larry.bell@trwa.org or search the archive at https://trwa.org/qualityontap/ One item to note in publishing or otherwise providing this

Quench — 2022 —Issue 2 9

TRWA News

TRWA Visits DC for the Rural Water Rally TRWA district directors, staff, and members visited the nation's capital during the last week of March for the National Rural Water Association's annual DC Rally. There they met with a number of Texas legislators and with rural water professionals from across the U.S. to advocate for continued funding for the programs rural water systems rely on and ensure that policymakers know the needs of our community.

Pictured from left to right: TRWA board members Mark Gardenhire, Kent Watson, Executive Director Lara Zent, Congresswoman Kay Granger, Paula Weber, Allen Knight and Bruce Alexander.

Bruce Alexander, Lara Zent, Congressman Tony Gonzales and Mark Gardenhire.

TRWA board members Bruce Alexander and Mark Gardenhire with Congressman August Pfluger.

Bruce Alexander, Lara Zent, Congressman Henry Cuellar, Nora Ureste and Pete Rodriguez.

One benefit of visiting Washington D.C. in March: our delegation was there for peak cherry blossom bloom, as Pete Rodriguez, Nora Ureste, Mark Gardenhire, and Bruce Alexander found.

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TRWA News

2022 TRWA Awards of Excellence Winners TRWA's Awards of Excellence honor some of the individuals and systems who have distinguished themselves in their efforts to support their systems, their communities and the rural water and wastewater industry as a whole. These awards were presented during the Opening General Session of RuralWaterCon 2022. nursing home that needed beverages.

By throwing themselves into the community response rather than just the system response, The Consolidated WSC team forged a renewed sense of teamwork, commitment and pride.

The 2022 Large System Excellence award is sponsored by: Master Meter.

Large System Excellence The Consolidated Water Supply Corporation Even in the best of times, The Consolidated WSC has learned to do a lot with a little. A staff of just 21 employees manages a massive and rapidly expanding distribution system, including 26 pressure planes, 10 wells, 66 tanks and approximately 7,000 miles of pipe.

As proved true across the state, the February 2021 winter Small System Excellence storm was not the best of times, but it did bring out the South Rains Special Utility District best in the system and its staff. For 14 consecutive days, employees came to work even when their own homes were without power and water. They carpooled when their cars As a small system that has grown significantly over the last wouldn't start and shuttled office staff whose vehicles several years, the South Rains SUD team has done its best to keep on top of its growth and find ways to improve their struggled on the ice to and from work. system. This has included digitally mapping their entire This dedication allowed The Consolidated WSC to contin- system including lines, meters, valves and other facilities to ue serving its community throughout the storm in ways that more easily identify problems and be able to show customwent far beyond its emergency response plan. It distributed ers what facilities and services are in their area. parts and pipes free-of-charge when hardware stores began to run out. It coached customers how to locate, report and The South Rains team also takes pride in maintaining a isolate spinning meters in their neighborhoods, leading to good rapport with their community. They implemented a neighbors going door-to-door to help fix leaks and keep Salvage Your Scrap Program, a project that started in 2017 as a way to help their customers clean up scrap metal in the the system running. wake of a tornado. Originally a TRWA Emerging Leaders The staff arranged for potable water stations to be set up Program project conceived by General Manager Rachel in the parking lot of a local hospital after it had trouble Webb, it proved so popular that South Rains has continued getting water due to city outages and filled them with the doing it annually each September, with customers callhelp of volunteer fire departments. They donated supplies ing every summer to make sure it's still on the schedule. from a community engagement event to a hospital and Customers and community members bring unwanted scrap 14 Quench — 2022 — Issue 2

TRWA News to the utility office where it can be piled into a full load information needed for the project. to bring to a nearby recycling facility. South Rains then Jacquelyn has utilized the assistance of TRWA and the donates the proceeds to the Texas Rural Water Foundation. FMT program to bring in additional training for the board and staff and conduct rate studies to ensure the The 2022 Small System Excellence award is sponsored system rates are where they should be to cover expenses

by CoBank. and debt services. She has also recently worked with the county judge and commissioners to ensure that rural water systems in the county receive access to ARPA funds for their emergency infrastructure needs. The time and effort that Jacquelyn put into pursuing this request has not only created the opportunity for Mountain WSC to receive money for an emergency generator but has opened the door for other rural water systems to apply for this funding.

The 2022 Excellence in Administration award is sponsored

by Rural Water Impact/Municipal Impact.

Excellence in Administration Jacquelyn Knobloch Mountain Water Supply Corporation Jacquelyn Knobloch started at Mountain WSC in early 2020 as a part-time employee training to take over as the new office manager, but she came into the role with water background on both the field and the administrative side, holding a BPAT and CSI licenses.

At Mountain, where she's one of just two employees, that knowledge and versatility comes in handy. She offers her CSI license to the system for no additional pay so that now the system can save money from outsourcing this service to a contractor. Over the past two years, Jacquelyn has constantly implemented processes to better the system.

One item she initiated was ensuring the system had a Cross-Connection Control Program. With her experience with CSI and BPAT, she was aware of the requirements the system must comply with to identify and address cross connections in the system.

Excellence in System Management Kevin Spence Cypress Springs Special Utility District For 32 years, General Manager Kevin Spence has been integral to the growth of Cypress Springs SUD. Kevin began with the system in 1989 as a Field Maintenance employee, serving roughly 800 customers and today the system serves over 4,700 connections. Kevin moved into the Field Supervisor role in 1997, where he helped oversee the building of a new office, a plant upgrade, a plant rebuild, new storage facilities and the installation of miles and miles of new lines. Throughout these upgrades his experience and knowhow proved invaluable.

Jacquelyn implemented Mountain’s first credit card billing system, helping members pay their bills more easily.

She created a new budget and financial guidelines for the system to help them secure a loan for projects outlined Since 2015, Kevin has served Cypress Springs as general in their Capital Improvement Plan and to save the util- manager. He brought to the position not only his institutional ity money in its day-to-day operations. She also worked Continued on next page: with professional services to obtain legal and engineering Quench — 2022 —Issue 2 15

TRWA News knowledge of Cypress Springs and its surrounding area, but a willingness to take a leadership role with the rural water community at the local level and statewide. To that end, he served on the TRWA Board of Directors since 2013, and most recently served as the Association’s Secretary on the Executive Committee. He also served the Association as President of the Texas Rural Water Foundation. In 2022, Kevin decided to step down from his director position on the TRWA board but continues to serve as an alternate director.

Recently, Cypress Springs held a 50th anniversary event at the office, where Kevin spoke about the growth of the system and honored past board members and employees by planting trees along the driveway around the building with memorial plaques. Kevin has been a part of that story for the majority of it. He is the type of employee and manager that every water system looks for: someone who starts at the bottom and works their way to the top while serving in a selfless manner along the way.

design, construction and installation of numerous capital improvement projects totaling more than $15,000,000. His meticulous system oversight has earned SS WSC a 4-Log System Certification from TCEQ and a 100 percent “no major finding” streak through multiple Comprehensive Compliance Inspections.

Napolean leverages the vast experience he has gained working in all aspects of general construction, water production and distribution to help identify and construct clever and cost-effective technical solutions that sometimes even seasoned engineers overlook. His uncanny ability to find solutions to distribution design problems has aided in SS WSC's development over the last quarter-century. He has technical smarts, the ability to take the theoretical directly to the practical and successfully leads his team.

Napolean currently holds a B Groundwater license along with licenses in CSI and BPAT. During his time as foreman, he has mentored more than 25 Class D and C Groundwater Operators, 10 Customer Service Inspection operators, and three Class B Groundwater Operators. He consistently The 2022 Excellence in System Management Award is completes projects on time at or under budget and uses sponsored by Master Meter. his experience to inspire those under his charge to strive for the same level of excellence and achievement.

The 2022 Excellence in Operations Award is sponsored

by WIN-911

Financing Solutions for Rural Water Systems In partnership with TRWA, CoBank can offer members specially negotiated terms.

Excellence in Operations Napolean Cervantes SS Water Supply Corporation More than 25 years ago, Napolean Cervantes began his career at S.S. WSC going from Meter Reader to Operations Foreman after just one year of employment. The decision proved to be a boon for the system, as Napolean continues to perform his day-to-day duties with the same zeal, dedication, and attention to detail that got him promoted in such an extraordinarily short amount of time.

Since being hired, Napoleon has taken the system from 1,400 connections to more than 6,100 connections today, with more growth still coming. He has supervised the

Visit www.trwa.org/cobank or contact John DeLuca at 303-694-5958

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TRWA News

Meet Your TRWA Board of Directors

Members of the TRWA Board of Directors, from left to right: Robert Nettles, Charles Beseda, Pat Allen, Steve Adams, Chris Boyd, Bruce Alexander, Rachel Webb, Dave McMurry, Kent Watson, Mark Gardenhire, Brian Macmanus and Allen Knight. Not pictured are board members Paula Weber and Matthew Barrett.

2022-2023 TRWA Board of Directors

District 1 - Mark Gardenhire, Fort Griffin SUD District 2 - Bruce Alexander, East Medina SUD District 3 - Chris Boyd, Mustang SUD District 4 - Steve Adams, Brookesmith SUD District 5 - Dave McMurry, Aqua WSC District 6 - Brian MacManus, East Rio Hondo WSC District 7 - Allen Knight, North Collin SUD District 8 - Charles Beseda, Birome WSC District 9 - Pat Allen, Green Valley SUD District 10 - Kent Watson, Wickson Creek SUD District 11 - Rachel Webb, South Rains SUD District 12 - Paula Weber, Ables Springs SUD District 13 - Robert Nettles, Riverside SUD District 14 - Matthew Barrett, Swift WSC

2022-2023 Alternate Directors

District 1 - Steve Clemmer, Hamby WSC District 2 - Danny Smith, Bandera County FWSD 1 District 3 - Dennis Donoho, MEN WSC District 5 - Roby Jekel, Beth Milam Falls WSC District 6 - Steve Sanchez, North Alamo WSC District 7 - Ross Brookbank, Copeville SUD District 9 - Adam Telfer, Canyon Regional Water Authority District 10 - Kyle Eppler, Wickson Creek SUD District 11 - Kevin Spence, Cypress Springs SUD District 13 - Amber Stelly, The Consolidated WSC

2022-2023 TRWA Officers

President - Bruce Alexander, East Medina SUD Vice President - Robert Nettles, Riverside SUD Secretary - Mark Gardenhire, Fort Griffin SUD Treasurer - Steve Adams, Brooksmith SUD Immediate Past President - Chris Boyd, Mustang SUD

Visit trwa.org/statemap to find a larger version of the above map that you can zoom in on to find your county.

Quench — 2022 —Issue 2 17

From the Field

For decades, the state's metropolitan areas led the way on water resource development, with one eye on what was to come. Today as populations boom and droughts loom, the rest of the state is learning that...

By Bruce Pearson

THE FUTURE IS NOW Resource development has always been an essential function of the water utility industry in Texas. For as long as there has been a Texas, it has been growing. For as long as there have been water utilities here, they've had to figure out how to manage that growth. But they haven't all had to do it at the same time.

In the past, it was mostly the larger metropolitan areas that concerned themselves with expanding their existing sources of water. Whether by signing contracts to withdraw more surface water or by the permitting and drilling of existing groundwater sources, these cities took a number of steps to grow their inventories over the years.

For Houston, the need was particularly pressing since rapid growth kicked off in the 1950s thanks to the oil industry and the movement of goods by way of the Houston Ship Channel. The Houston-Galveston Subsidence District was established in 1975 to regulate the pumping of groundwater from the Chicot and Evangeline Aquifers, which are sub-formations of the Gulf Coast Aquifer. Surface water reservoirs were accessed to increase 18 Quench — 2022 — Issue 2

water supply inventories from Lake Houston beginning in 1954 and then again in 1997, as well as in 1976 from Lake Livingston. The City of Galveston began using surface water exclusively in the early 1970s.

On the other side of the state, El Paso sought to keep its supply reliable despite limited rainfall and limited sources of water. The City of El Paso began injecting 6.5 million gallons of treated wastewater into the Hueco-Bolson Aquifer in 1985 to maintain aquifer levels. In 2007, El Paso and Fort Bliss began operating a desalination water plant with the capability to produce 27.5 million gallons of potable water per day. At the time, it was the largest inland plant of its kind in the world.

These two areas served as harbingers for the central corridor of the state, which saw its population explode after free trade agreements with Canada and Mexico signed in the late-1980s and mid-1990s caused the I-35 corridor to boom. From Laredo all the way to Gainesville, populations began to grow at a rapid pace. There was an immediate need for additional water in this region to meet new demand.

In north Texas, the construction of new reservoirs offered an easy way to increase water supplies because of the large watershed. The central portion of the corridor expanded water supply inventories by either contracting for more surface water, diversifying groundwater with surface water or by drilling/permitting more groundwater from existing aquifers, but this was not without its complications. In 1993, a federal court ruling placed a cap on the amount of water withdrawn from the Edwards-Balcones Fault Zone Aquifer in south central Texas to assure adequate spring flows.

Legislative action in 1993 established the Edwards Aquifer Authority to regulate the withdrawal of the aquifer. It soon implemented reductions in historical pumping rights by 25-30%.

The combination of rapid increases in population and caps placed on existing supplies ushered in innovative ideas for water resource development in this region. By the year 2000, suppliers were treating brackish water (desalination), investing in aquifer storage and recovery (ASR), raising levels of existing reservoirs, and/or developing reclaimed/

From the Field recycled water systems (treated were implemented, such as augmenting surface water supplies with wastewater). highly treated wastewater to furToday, the future is arriving for sys- ther maintain inventories. Drought tems across Texas. The population conditions have become common in Texas has grown by 45% between throughout western Texas. Today, 2000 and 2020, from 20 million peo- there are more than one hundred deple to more than 29 million. Mid-size salination plants in Texas. Planning and small water utilities are growing in these regions of the state is critical exponentially, forcing them to make for having adequate water inventomajor decisions when it comes to ries for the future. acquiring additional water resources.

Acquiring permits from Groundwater Conservation Districts has become a challenge due to the availability of water in certain areas. In 2000, the Texas Water Development Board determined the amount of water withdrawn from the state’s aquifers far exceeded the ability of these aquifers to replenish themselves from natural recharge. About half the state’s population is supplied by groundwater, but if this source continued to be "mined" unsustainably, a lot of people would have difficulties.

Purchasing raw water from surface water supplies is becoming increasingly difficult as well. River authorities, who set the raw water rate for surface water and manage the river basins throughout the state, are becoming increasingly prudent in providing additional surface water in some basins. In outlying areas, acquiring additional water resources can be limited by availability.

The recent worst one-year drought of 2011 left numerous utilities with only days of water and a grim sense of foreboding for what might lie in their futures. Innovative approaches

There is no one easy answer for obtaining additional water.

What one region is doing to bolster their supplies may not work elsewhere.

utilities that work together to develop resources discover that money can be saved via economies of scale, where producing more water makes the cost cheaper on a relative basis.

These solutions all require smart monetary planning. Prudent management by boards, councils and managers is vital to the overall health of the utility and the confidence of its customer base.

In today’s environment, there is no one easy answer for obtaining additional water. What one region is doing to bolster their supplies may not work elsewhere. Conservation, however, is one strategy that can be done anywhere. Conservation measures have allowed water providers to further expand existing water supply inventories.

The education of residents, as well as the commercial and manufacturing/industrial sectors, should be an ongoing endeavor. Teaching children from an early age about the The dominant question facing wa- importance of conserving water can ter utilities throughout the state is, help well into the future by creating “What are we going to do for the a culture of conservation. future?” Ideally water utilities should begin the process of planning for Effective conservation measures future water needs at least five years have included reduction in irrigain advance, but that can be tough tion and low-flow showerheads and for utilities that have experienced toilets. Water providers have ensudden rapid growth. These utilities couraged or provided incentives for have the need for more water now. property owners to xeriscape/ plant drought-tolerant plants. Utilities Some utilities have opted to pur- have implemented ascending rate chase water from wholesale sup- structures, which promote conserpliers or sought out new areas to vation. Systems to recycle water at drill wells. Others have joined with high-volume users such as commerother utilities, forming or joining cial car washes have become popular wholesale supply entities, to invest as well.

Continued on next page: in water resources together. These Quench — 2022 — Issue 2 19

Features Another measure utilities may take is establishing reclaimed/recycled water systems for non-potable uses.

Reclaimed/recycled water systems deliver highly treated wastewater for non-potable uses such as irrigation and cooling system processes. Large versions of these systems are now in use throughout the central corridor of the state, while smaller systems might use more limited versions for one or two specific site deliveries, such as golf courses or parks. This alone can further expand existing supplies. One utility has found that every dollar spent on this type of system can save about ten dollars compared with developing new water resources.

This saves the ratepayer money.

innovation in some areas of the state, particularly the conversion of wastewater directly to potable water. The term used for this type of treatment is Direct Reuse or Direct Potable Reuse.

One large city in the western U.S. has been converting wastewater to potable water for three months or so. One purveyor in the central corridor of the state has announced a feasibility study for developing this type of water resource. Several states, including Texas, are in the process of developing rules for the treatment regimen and its parameters.

It's clear that public perception will play a key role in this type of water resource development. Educating Now numerous professionals in the the public will be paramount to its water utility business believe the time success. This process will paralhas come for the next generation of lel the instruction that took place

J. F. FONTAINE & ASSOCIATES, INC. CONSULTING ENGINEERS RURAL WATER SYSTEM ENGINEERING SINCE 1962 700 N. Sycamore St. P.O. Box 4187 Palestine, Texas 75802

20 Quench — 2022 — Issue 2

(903) 729-6005 jffontaine@jffontaine.com

in developing reclaimed/recycled water systems for non-potable use.

However, direct potable reuse will require a much more complex outreach effort on both a statewide and local basis.

A combination of all these approaches will be needed as our population in Texas continues to grow. In many places it's clear the old ways of resource development can no longer keep up. For them, the future is already here.

Bruce Pearson is a TRWA instructor with more than 28 years experience in the water utility industry.

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From the Field

Know Before You Grow

By Kathleen Jackson, P.E.

The Texas Water Development Board is making it easier than ever for small systems and rural utilities to invest in asset management Rural communities across Texas are enhancing the operational integrity of their systems by investing in asset management. Developing an asset management plan can help you gain a thorough understanding of your system’s sustainability, prioritize projects, budget for rehabilitation and repairs and position your community to better meet customer demands. Being proactive, rather than reactive, can save your utility money. By identifying vulnerabilities and moving forward with equipment repairs or upgrades before they become issues, systems can avoid the escalated costs associated with emergency downtime.

As I traveled across Texas meeting with rural communities, I saw firsthand the many challenges city administrators and utility operators face every day. Often one person wears many hats. The city administrator might also be the water operator, and years of operating know-how and system information may reside in that one head.

To help that system save and spread that information, a technical expert can work alongside veteran operators to create system maps, equipment inventories, day-to-day operating procedures, maintenance checklists and 22 Quench — 2022 — Issue 2

created by the TCEQ’s Small Business and Local Governmental Assistance Section. They first conducted a system inventory, including asset identification, location, and date of service or approximate age of the system. Other deliverables included worksheets showing the inventory and prioritizaTo further this objective, the Texas tion of assets, a comprehensive plan Water Development Board (TWDB) and budget for managing system assets launched a pilot initiative called the and an analysis of whether a rate study Asset Management Program for Small was necessary.

Systems (AMPSS). Three water and three wastewater systems from dif- Water systems developed best manferent geographic areas of the state agement practices for sustaining the were selected with assistance from the system’s drinking water source or idenTexas Commission on Environmental tified options for alternative sources, if Quality (TCEQ). The TWDB pro- needed. They also created or updated vided funding of up to $75,000 per water conservation and drought consystem to create comprehensive asset tingency plans and identified plans for management plans to serve as road- detecting and minimizing water loss. maps for managing these systems in a Wastewater systems created a plan to financially and technically sustainable manage the system more efficiently by conducting an energy assessment manner. of the system that included recomThe six systems each selected a con- mendations for energy-efficiency tractor to perform engineering services improvements. from the TWDB’s procured contractors list. The contractors and systems The program also led systems to crethen worked together for more than a ate their own System Operations and year to create their asset management Maintenance manuals. These included plans, along with other management plans for scheduling and performing tools, in accordance with guidelines preventative and general maintenance equipment replacement priorities. By helping operators better understand their systems and the needs associated with operating and maintaining their systems, small communities can then be empowered to manage their assets proactively.

From the Field and identified other resources available to the systems as well, such as the TCEQ’s Financial, Managerial, and Technical Assistance Program that provides free on-site support through TRWA. The tools and documentation produced by the AMPSS contractors and participant systems, including dashboards that highlight key points of information; inventories of assets and prioritized lists of projects to help with planning in the short and long terms, have been used to help bridge a knowledge gap and communicate the needs of the system more efficiently and productively. Having updated operating manuals can assist communities dealing with staff turnover, as new employees now have a comprehensive reference and an executive summary geared just to them.

In one community that participated in the AMPSS Pilot Initiative, community leadership benefitted tremendously from using GIS software to map their water system and gain an increased understanding of the system as a whole. Having up-to-date paper maps and records are key to successful digitalization. As a result, that community now has the ability to do more comprehensive planning and prioritization of maintenance and infrastructure projects and avoid situations where a newly paved street has to be dug up again several months later to replace a water line.

To discuss implementation and lessons learned for future AMPSS participants, the TWDB hosted a Board work session in January 2022 with the AMPSS pilot participants. The feedback we received was overwhelmingly positive. Participants reiterated that there’s no one-size-fits-all approach in Texas; tools and software need to be tailored to the individual system.

AMPSS pilot participants share their insight during the January 2022 TWDB work session in Austin

weather events, the TWDB increased the total amount of funding per project from $75,000 to $100,000 in the Fiscal Year 2022 Clean and Drinking Water IUPs. Stay tuned to the TWDB’s website, www.twdb.texas.gov, for information on how to participate in In addition to launching the AMPSS subsequent rounds of our AMPSS and pilot program, the TWDB also es- SRF programs. tablished two funding sources within the Clean Water and Drinking Water Today, AMPSS is a resounding success State Revolving Fund (SRF) Intended due to the committed and engaged Use Plans (IUPs) to assist communi- leadership of our rural communities ties with asset management. One is and the active support of TRWA for any eligible system to create an and others who have devoted their asset management plan and the other time and talent to this endeavor. The is solely for small systems that are TWDB looks forward to continuing already implementing an asset man- to provide small communities opportunities to achieve system reliabilagement plan. ity through asset management. Asset Any system eligible for SRF fund- management, operational integrity, ing can apply for a 0 percent interest and leadership are key to proactively loan of up to $100,000 to prepare addressing infrastructure challenges an asset management plan. The plan and achieving a resilient future for must meet the criteria outlined in the communities across Texas!

AMPSS guidelines. Additionally, small Kathleen systems can apply for a 0 percent interest loan of up to $500,000 for a Jackson is a portion of their total TWDB project Texas Water funding if they are implementing an Development asset management program consistent Board member with the AMPSS guidelines. and a registered Due to the pilot initiative’s success and professional to provide additional resources to adengineer. dress resiliency planning for extreme Engaging community leadership from the beginning is an important part of the asset management process to achieve a better understanding of the system and to gain support for future infrastructure investment.

Quench — 2022 —Issue 2 23

Features

Take It to the Bank

By Grant Rabon

Laying out sound financial policies today can pay big dividends for water utility boards down the line Water utility board members are often asked to make decisions that will impact the utility for many years to come. From capital improvements to the acquisition of new water sources to everything in between, the board often must look far into the future to weigh the potential benefits and drawbacks of the items on its agenda, especially when it comes to how those projects should be financed.

It can be daunting to commit the utility to a course of action that may have financial implications for years or even decades, but one way to simplify the board’s task is by adopting a set of written financial policies that can serve as a useful guide for officials and ensure continuity of governing principles long after the current board members have retired from service.

Sensible financial policies can improve the risk management of the utility and assist policymakers in making decisions about the utility’s future.

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This has the potential to provide better rate stability and, if executed well, lower the cost of borrowing. Further, financial policies can help explain and support the need for rate adjustments.

This will not only assist the utility in communicating with stakeholders but also assist the utility should its rates be challenged at the Public Utility Commission of Texas, which will assess the appealed rate(s) based on the information available to the Board when it decided to adjust rates. In fact, to the extent that adherence to one or more financial policies is relevant to the decision to adjust rates, it may be prudent for the Board to record this fact for posterity in the minutes associated with the decision.

Well-designed financial policies should: • Consider the long-term view of utility financial health and stability.

• Be reviewed and, as needed, updated to reflect changing business operating conditions.

• Safeguard utility financial resources to execute the utility business plan.

Financial policies guide sound governance because they provide a context in which to judge potential decisions impacting the financial health of the utility. Further, as long as they are adhered to, prudently developed financial policies are typically viewed positively by lenders of capital, potentially facilitating better access to funds under more attractive terms.

Reserves There are no hard rules on what metrics should be included in the utility’s financial policies, but there are some common approaches. For example, it is typical for written financial policies to include a metric to assess the financial reserves of the utility. Reserves are a measure of liquidity, or the ability to meet short-term liabilities, particularly under unforeseen hardships. One of

Features the most common ways for this metric to be measured is based on Days Cash on Hand (DCOH), which is generally calculated as: DCOH = (Current Unrestricted Cash and Investments) ((Annual Cash Operating Expenditures / 365 Days in a Year))

The number of days cash on hand to target is dependent on several factors, including financial commitments, what other financial policies exist to manage risk and the utility’s overall level of risk aversion or acceptance.

A key benefit of sufficient DSC is that or access to a line of credit may serve it indicates revenue in excess of cash this purpose. operation and maintenance expenses, Others which can be used to cash fund some portion of capital expenses annually. Financial policies could be developed to address a myriad of other risk facImportantly, if a utility adopts a finan- tors or policy goals. A policy might cial policy regarding DSC, it should mandate a certain level of cash fundnot set the target equal to the level ing for capital projects annually or a mandated in the bond covenants. First, maximum amount of leverage for the this would render the financial policy utility. A financial policy might include meaningless since the utility has al- policy goals around affordability or ready committed to satisfying this low-income assistance. There might requirement. Moreover, the financial also be a financial policy that outlines policy should be set higher than the exactly what should be included in bond covenant to provide a buffer rates set by the utility, which can prove to accommodate unexpected events very helpful to policymakers and those (e.g., increases in expenses or de- reviewing the decisions made by the creases in revenues). If the financial Board. policy is set to merely achieve the same DSC mandated (as a minimum) Benchmarking data from industry in the debt covenants, and rates are sources (e.g., the American Water designed to satisfy this policy target, Works Association and credit rating then the utility runs a high chance of agencies) may be available for some defaulting on the bond commitment if of the more common metrics found in financial policies to help the utility anything unexpected occurs. evaluate how they compare with their industry peers.

For example, if a utility has a contract to purchase water with a take-or-pay structure (meaning the utility has to pay the same amount whether it takes delivery of all, some, or none of the water under contract), then this might indicate the need for a higher target DCOH because if water sales are reduced, the utility will have to make the fixed payment for water under the contract in the face of decreased revEmergency Funds enues from volumetric rates. Thus, the appropriate target DCOH can vary The utility should also consider what significantly from one utility to another funds are available to pay for resolving an emergency. For example, if an based on their circumstances. emergency repair is necessary, the utility may need ready access to funds Debt Service Coverage to pay for the repair. Even if the event Another common metric in financial is covered under an insurance policy, policies is Debt Service Coverage it will take some time to collect on the (DSC), a measure of financial flexibil- insurance, and there will typically be ity that judges a utility’s financial mar- a deductible for such an event. gin to pay debt service from revenues net of priority expenses, such as op- Thus, the utility should have some fieration and maintenance expenses. It nancial means of promptly addressing is common for utility debt covenants to an emergency to continue to provide require DSC, such as 1.25x. Although safe and reliable service. Unless the there can be variations in the way DSC target DCOH previously discussed is calculated, the general formula is is specifically sized to accommodate typically as follows: this type of event, identification of an additional source of funding may be DSC = prudent. There could be a separate (Total Revenue - Cash O&M Expenses) financial reserve policy established (Annual Debt Service Payments) to set aside funds for such an event,

This article does not serve as a comprehensive discussion of all possible relevant financial policies. There are many other financial policies that a utility might have specific to its particular issues or risks. The key is to develop financial policies that are well-defined, reflective of financial risks and that help effectively manage the utility’s cash flow and balance sheet. It is also important to routinely educate stakeholders about the rationale, costs and benefits of various financial policies.

This overview should serve as a good outline to get the conversation started at your utility.

Grant Rabon is a partner at NewGen Strategies and Solutions.

Quench — 2022 —Issue 2 25

TRWA News

TRWA Welcomes Three New Staff Members The Texas Rural Water Association has rounded out its staff with three new hires in the first months of the year.

He joined the City of Galveston's Public Utilities Department as their GIS Field Technician in 2020, boosting the Wastewater Collection Division's Proactive Maintenance Program to become a model for the industry before moving to TRWA. Later in February, TRWA added Kayla Mitchell as our new paralegal. Kayla is a proud native of northeast Austin, growing up there with her parents, Henry Jr. and Chelsea, and siblings, older sister Alexis and younger brother Henry III. She comes from a big extended family as well, with multiple generations of cousins, aunts, and uncles, spread all over the great state of Texas.

Joining our team in February was our new Member Services Specialist Justin Guerra, who is helping us implement some of the additional programs TRWA offers for the benefit of our members, including our GIS Mapping and drone services offerings.

Justin studied Geography and Environmental Sustainability at the University of Texas at San Antonio, but his interest in how place and space can affect the lives of people living there stems from his childhood, when he and his mother would participate in missionary trips in the Mexican border city of Reynosa. There, while distributing supplies, he became interested in Earth science and how it might be used to better understand spatial and global inequities.

Justin got more firsthand insight into these issues while serving for five years in the U.S. Marine Corps. His unit assisted in the recovery efforts in New Jersey during and after Hurricane Irene. A year later, he volunteered to deploy to Afghanistan and witnessed the harsh living conditions of locals there. In 2014, he worked on the initial U.S. humanitarian effort during the Ebola crisis in Liberia.

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She graduated with a bachelor’s degree in political science and a minor in criminal justice. After graduating a year early in 2016, she went to work at the Internal Revenue Service in Austin. While there, Kayla decided to go back to school to obtain her master’s degree in legal studies with simultaneous certificates in paralegal services and mediation which she completed in 2019.

In addition to Justin and Kayla, in March TRWA brought on Jewel Uzquiano as our new Source Water Protection Specialist. She replaces Deborah McMullan, who has moved to become our Membership and Outreach Manager, in that role.

Jewel is based in San Antonio, though she grew up in Kansas, Oklahoma and throughout Texas. She earned her Bachelor of Arts degree in Geography from the University of Texas at San Antonio. Before coming to work for TRWA, she worked for the University of

Texas at San Antonio in the Environmental Science and Geography departments as a peer mentor and research assistant, where she helped other students and contributed on various research projects.

Following this, she worked for the Texas A&M Natural Resources Institute for more than 4 years, where she was employed within the research team as a research technician and associate.

In her free time, Jewel enjoys reading, going to yoga classes, making hot tea, and spending time with her family and friends.

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Quench — 2022 —Issue 2 27

TRWA Briefs Get specialized training at our remaining conferences RuralWaterCon 2022 has come and gone, but there are still two more opportunities this year to meet with your statewide TRWA community for training, networking and camaraderie.

♦ 2022 Training & Technical Conference Come sail away with us to the Galveston Island Convention Center July 1314 for our annual Training & Technical Conference. Learn the latest on the Lead and Copper Rule Revisions, managing disinfection byproducts and maintaining business continuity. We'll also offer field trips to a Gulf Coast Water Authority Surface Water Treatment Plant and a City of Galveston Wastewater Treatment Plant. Scan the QR code on the right or visit trwa.org/tech22 to register beginning April 28.

♦ 2022 Office Professionals Conference Meet us on the Riverwalk in San Antonio for the 2022 Office Professionals Conference October 13-14. Learn how to improve your collections, upgrade your cybersecurity and answer public information requests with confidence.

The 2022 Office Professionals Conference will also offer roundtable discussions so that you have an opportunity to steer the conversation. Scan the QR code on the right or visit trwa.org/opc22 for more information. Registration will open in August.

Join the conversation at: www.facebook.com/TexasRuralWaterAssn

Find us at @TexasRuralWater for industry and legislative news relevant to you!

Advertiser Index AIA Insurance Agency................................. Page 7 Axis Construction...............................................29 Childress Engineers..............................................7 CoBank..............................................................16 Esri....................................................................20 Ferguson...........................................................21 Hayter Engineering...........................................27 Hayes Engineering.............................................29 HydroPro Solutions.............................................9 28 Quench — 2022 — Issue 1 2

J.F. Fontaine & Associates..................................20 Pittsburg Tank & Tower Maintenance Co., Inc.......9 Pyxis.................................................................27 Russell Drilling Co., Inc.........................................6 Texas Aquastore................................................30 SAMCO.............................................................. 11 Smith Pump Co., Inc………………...…………………..20 USA BlueBook………………...……......…..Back Cover

TRWA now offers a Spanishlanguage training manual

Martinez receives Utility Management Certification

TRWA is proud to now offer our first Spanish-language training manual for purchase in our online store. The manual covers material from our Basic Water Works Operations course, and was recently approved by TCEQ. Visit trwa.org/manuals to find it.

Following the manual, TRWA is also on the brink of offering our self-paced online Basic Water Works Operations class in Spanish, so stay tuned to our website and Weekly Pipeline for more information on that once it's finalized. We're excited to make our training materials more convenient to Texans with these new additions.

Adrian Martinez of the City of Dilley has recently completed his Utility Management Certification through the NRWA/TRWA Water University.

Martinez started in the water and wastewater industry in 2013, and has worked his way up to obtain a Class B Wastewater License, among others. He said this new certification would help prepare him for a management role in the future.

The Utility Management Certification Program is designed to enhance the financial, managerial and operational effectiveness of drinking water and wastewater systems across the country and to create a national designation for qualified utility managers.

Upcoming District Meetings Don't miss your chance to attend a TRWA District Meeting near you. We have four meetings currently scheduled for the late spring and summer months, so find one near you whether it's in your district or not and join us for training, networking and lunch. For more information or to register, visit www.trwa.org/district-meetings.

District 10 - May 11 Navasota, 11 a.m. to 3 p.m.

District 7 - June 21 Location TBD, 11 a.m. to 3 p.m.

District 1 - May 26 Abilene, 11 a.m. to 3 p.m.

District 2 - August 25 Davis Mountains State Park, 11 a.m. to 3 p.m.

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Quench — 2022 —Issue 2 29

Legal Brief Late March saw an important development in a legal case that could have lasting impacts on the relationships between rural water utilities and their municipal neighbors.

A federal district judge has ordered a new trial in a case brought by Green Valley SUD against the commissioners of the Public Utility Commission and the City of Schertz, after initially dismissing the case after it was remanded by the Fifth Circuit Court of Appeals. The case involved the PUC granting Schertz's petition for single certification under Texas Water Code Section 13.255 for an area that was within Green Valley's CCN.

30 Quench — 2022 — Issue 2

At the center of the case lies a conflict between state law under Section 13.255, which grants single certification to a municipality of a rural system’s service area in exchange for compensation, and federal law under Section 1926(b) of Title 7 of the United States Code, which protects a utility with federal debt against municipal encroachment of their service area. The case has been progressing through the courts since 2016, with an initial win for Green Valley at the district court level being overturned by the Fifth Circuit Court of Appeals, with a remand back to the district court to determine the case under a new "physical capability" test.

Green Valley argued that they

were never given the opportunity to demonstrate they could provide service. The PUC and Schertz argued that since Schertz has held the CCN since 2016, they cannot request service from Green Valley; and that Green Valley didn’t have the capability in 2016.

The Judge’s order held that " the protections of Section 1926(b) are federal and cannot be curtailed unless the federally-indebted utility cannot provide service within a reasonable time after a request has been made." Since Schertz never requested service from Green Valley before the City sought decertification, the court concluded that reconsideration is warranted.

The Months Ahead Here's a look at a small sample of the events TRWA has scheduled for the next two months. To see more trainings, regional meetings, conferences and more, visit www.trwa.org/event_calendar

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May 26 District 1 Meeting 11 a.m. to 3 p.m. | Abilene, TX

JUNE 2022 June 14 - 16 Surface Water Production II in Harlingen & Water Utility Safety in San Antonio

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June 28-30

Water Distribution in Quinlan & Basic Water Works Operations in Kilgore & Virtual Wastewater Collections

Quench — 2022 —Issue 2 31

1616 Rio Grande| Austin, TX 78701-1122 Telephone: (512) 472-8591 | Fax: (512) 472-5186 www.trwa.org

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