the Upper Trinity Regional Water District and Texas Commission on Environmental Quality v. National Wildlife Federation

ACCEPTED
01-15-00374-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
7/27/2015 5:40:09 PM
CHRISTOPHER PRINE
CLERK

NO. 01-15-00374-CV FILED IN
1st COURT OF APPEALS
HOUSTON, TEXAS
In the Court of Appeals for the
7/27/2015 5:40:09 PM
First District of Texas — Houston CHRISTOPHER A. PRINE
Clerk

THE UPPER TRINITY REGIONAL WATER DISTRICT,
AND THE TEXAS COMMISSION ON ENVIRONMENTAL
QUALITY,
Appellants,
v.
NATIONAL WILDLIFE FEDERATION,
Appellee.

ON APPEAL FROM THE l26TH DISTRICT COURT
TRAVIS COUNTY, TEXAS

BRIEF OF APPELLEE

Myron J. Hess
State Bar No. 09549415
Annie E. Kellough
State Bar No. 24074517

NATIONAL WILDLIFE FEDERATION
44 East Ave., 200
Ste.
Austin, Texas 78701
Telephone: (512) 610 — 7754
Facsimile: (512) 476 — 9810
hess@nwl'.or2
kellou2haC1nwl‘.or9

Att0n1eysf0rAppellee National Wildlife Federation

ORAL ARGUMENT REQUESTED
TABLE OF CONTENTS

TABLE OF CONTENTS ........................................................................................... .. 2
INDEX OF AUTHORITIES ...................................................................................... ..4

STATEMENT REGARDING ORAL ARGUMENT ................................................ 8

~
..

STATEMENT OF THE CASE .................................................................................. .. 9
ISSUES PRESENTED ............................................................................................. .. 12
STATEMENT OF FACTS ............................................................................ .. 13
A. The District submitted an application to TCEQ for Water Use Permit No.
5821 for the construction of Lake Ralph Hall and for an interbasin transfer of
water from the Sulphur River Basin to the Trinity River Basin ................. .. 13
B. The Parties participated in a contested case hearing at State Ofﬁce of
Administrative Hearings. ............................................................................ .. 13
C. TCEQ granted the District’s application for Water Use Permit No. 5821... 15
D. District Court detennined that TCEQ erred in granting the District’s permit
due to lack of compliance with Water Code Section 11.085 (l)(2). ........... .. 15
SUMMARY OF THE ARGUMENT ....................................................................... .. 17
ARGUMENT ............................................................................................................ .. 21
A. Standard of Review: .................................................................................... .. 21
B. TCEQ erred by approving issuance of the permit in the absence of a water
conservation plan meeting the explicit statutory prerequisites of Section
11.085 (l)(2) of the Water Code. ................................................................ .. 23
1. Section 11.085 (l)(2) establishes an unambiguous and stringent
prerequisite to approval of an interbasin transfer ................................... .. 23

2. TCEQ ignored the plain language of Section 11.085 (l)(2) and allowed
the District to choose what levels of conservation and efﬁciency to
include ..................................................................................................... .. 28
3. Report 362 is not an adequate test for compliance with Section 11.085
(l)(2) ........................................................................................................ .. 31
4. The Region C Water Plan conservation recommendations do not justify
reliance on Report 362 or demonstrate compliance with Section 11.085
(l)(2) ........................................................................................................ ..38
2
C. TCEQ erroneously approved the District’s application even though the
District has not demonstrated that has implemented its water conservation
it

plan as required by Section 11.085 (l)(2) of the Water Code ..................... .. 43
D. TCEQ erred in determining that the District’s water conservation plan
includes the means for implementation and enforcement required by TCEQ’s
rules ............................................................................................................. 49 ..

E. TCEQ erred in determining that the District’s water conservation plan
includes the required basis for the development of its ﬁve-year and ten-year
targets for water savings in accordance with TCEQ’s rules ....................... .. 57

F. TCEQ’s errors prejudiced NWF’s substantial rights within the meaning of
Section 2001.174 (2) of the Government Code .......................................... 60 ..

PRAYER ................................................................................................................... .. 64
CERTIFICATE OF COMPLIANCE ........................................................................ 65 ..

CERTIFICATE OF SERVICE ................................................................................. ..66

References to the administrative record will be AR, Vol. No., Item, Page number(s).
INDEX OF AUTHORITIES
Cases

City of El Paso v. Public Util. Comm ’n, 883 S.W.2d 179 (Tex. 1994) ................ ..22

City of El Paso v. Public Utility Commission of Texas, 839 S.W.2d 895 (Tex.App. —
Austin 1992) .................................................................................................... ..22, 56

City of Marshall v. City of Uncertain, 206 S.W.3d 97 (Tex. 2006) ...................... ..24

City of San Antonio v Pollock, 284 S.W.3d 809 (Tex. 2009) ................................ ..46

City of San Antonio v. City of Boeme, 111 S.W.3d 22 (Tex. 2003) ...................... ..24

City of San Antonio v. Pollock, 284 S.W.3d 809 (Tex. 2009) ............................... ..52

Dallas Ry. & Terminal Co. v. Gossett, 294 S.W.2d 377 (Tex. 1956) ................... ..46

Duncan-Hubert v. Mitchell, 310 S.W.3d 92, 101 (Tex.App. — Dallas 2010) ....... ..53

Flores v. Employees Retirement System of Texas, 74 S.W.3d 532 (Tex.App.—Austin
2002, pet. denied) ................................................................................................... ..59

Hamamcy v. Texas State Bd. of Medical Examiners, 900 S.W.2d 423 (Tex. App. -

Austin 1995) .......................................................................................................... ..54

Jelinek v. Casas, 328 S.W.3d 526 (Tex. 2010) ......................................... ..45, 52, 60

Johnson v. City of Fort Worth, 774 S.W.2d 653 (Tex. 1989) ............................... ..39

Lone Star R. V. Sales v. Motor Vehicle Bd. of Tex. Dep ’t of Transp., 49 S.W.3d 492
(Tex. App.—Austin 2001, no pet.) ........................................................................ ..62

4
Mclntyre v. Ramirez, 109 S.W.3d 741 (Tex. 2003) .............................................. ..24

Nadaf v. Texas Comm '1: on Environmental Quality, No. 04-13-00068-CV (Tex. App.
2014) ...................................................................................................................... ..2l

Old Am. County Mutual Fire Ins. Co. v. Sanchez, 149 S.W.3d 111 (Tex. 2004) ...24

R.R. Comm '1: v. Rio Grande Valley Gas Co., 683 S.W.2d 783 (Tex. App. Austin
1984) ...................................................................................................................... ..61

Reliant Energy, Inc v. Public Util. Comm ’n, 153 S.W. 3d 174 (Tex. App — Austin
2004, pet. denied) ................................................................................................... ..22

Rogers Texas Ba’. 0f Architectural Examiners, 390 S.W.3d 377. (Tex. App. —
v.

Austin 2011) .......................................................................................................... ..46

State of Texas’ Agenciesand Institutions of Higher Learning et al v Public Utility
Commission of Texas et al, No. O3-11-00072-CV (Tex. App. — Austin 2014) ..... ..22

Texas A.B. C. v. Top of the Strip, 993 S.W.2d 242 (Tex. App. — San Antonio 1999).
.......................................................................................................................... ..47, 54

Texas Health Facilities Comm ’n v. Charter Medical-Dallas, 1116., 665 S.W.2d 446
(Tex. 1984), ............................................................................................................ ..62

Texas Water Development Board v. Ward Timber, 411 S.W.2d 554 (Tex.App.—
Eastland, 2013) ...................................................................................................... ..60

Texas Workers’ Comp. Comm ‘n v. Cont'l Cas. Co., 83 S.W.3d 901 (Tex. App. —
Austin 2002) .......................................................................................................... ..33

United Sav. Ass’n of Tex. v. Vandygriﬁ‘, 594 S.W.2d 163 (Tex. Civ. App.—Austin
1980) ................................................................................................................ ..61, 62
Statutes

Tex. Gov’t Code Ann. Section 2001.174(2) .................................................... ..22, 60

Tex. Gov’t Code Section 2001.172 ....................................................................... ..2l

Tex. Water Code Section 11.085 ........................................................................... ..39

Tex. Water Code Section 11.085 (a) ..................................................................... .. 17

Tex. Water Code Section 11.085 (k)(2)(c) ............................................................ ..39

Tex. Water Code Section 11.085 (l)(2) .......................................................... ..passim

Tex. Water Code Section 11.085 (v) ..................................................................... ..17

Tex. Water Code Section 11.1271 (a) ................................................................... ..25

Tex. Water Code Section 11.1271 (e) ............................................................ ..passim

Tex. Water Code Section 11.134 (b)(4) ................................................................ ..26

Tex. Water Code Section 16.053 ........................................................................... ..38

R01‘?-°>

30 TAC Chapter 288 .................................................................................. ..26, 50, 59

30 TAC Section 288.5 ............................................................................... ..26, 52, 60

30 TAC Section 288.5 (l)(B) .................................................................... ..20, 58, 64
30 TAC Section 288.5 (1)(H) ......................................................................... ..passim

30 TAC Section 295.9 ............................................................................... ..26, 50, 59

30 TAC Section 297.18 (d)(2) ........................................................................ ..passim

Tex. R. App. P. Section 38.1(e) ............................................................................... .. 8

Tex. R. App. P. Section 44.1 (a) ............................................................................ ..61
STATEMENT REGARDING ORAL ARGUMENT
Appellee agrees with Appellants’ requests for oral argument. This case involves

interpretation of a statutory provision of the Texas Water Code, Section 11.085(l)(2),

that is a matter of first impression in the Texas courts. There are significant nuances

and intricacies of the statutory requirement, as well as Appellant TCEQ’s application

of it in the context of other water conservation requirements, and oral argument would

aid the Court in making its decision in this precedent-setting case. See Tex. R. App.

P. 38.l(e)
STATEMENT OF THE CASE

This appeal by the Texas Commission on Environmental Quality (“TCEQ”)

and the Upper Trinity Regional Water District (the “District”) comes to this Court

from the Honorable Scott Jenkins of the 126"‘ District Court of Travis County after

his issuance of a Final Judgment, on March 6, 2015, reversing and remanding

TCEQ’s decision, as it relates to the application of Section 11.085 (l)(2), granting

Water Use Permit No. 5821 (the “Permit”) to the District on October 2, 2013.‘ Judge

Jenkins did not reach issues not governed by Section 11.085 (l)(2), ﬁnding those

issues moot in light of his reversal. The Permit as granted allows the District to

construct and impound water in a proposed reservoir, Lake Ralph Hall, for

recreational use and authorizes the District to divert and use the water via an

interbasin transfer authorizing the District to transfer water from the reservoir in the

Sulphur River Basin—the basin of origin—to the Trinity River Basin—the receiving

basin. The Texas Legislature, in 1997, imposed speciﬁc additional review criteria

and prerequisites for authorization of such an interbasin transfer through

amendments to Section 11.085 of the Water Code. This case involves the first

interpretation in a contested case context of one of those prerequisites, found in

'
AR, Vol. 11, Item 151.
Section 11.085(l)(2) of the Water Code, which imposes additional water

conservation requirements for interbasin transfers.

This case focuses on TCEQ’s failure properly to implement the explicit

statutory and regulatory water conservation prerequisites for granting the permit,

including the interbasin transfer sought by the District. Although Appellee disputed

various issues related to environmental impacts of the proposed project during the

agency proceeding, those issues are not raised on appeal.

The contested case hearing on the merits of this matter occurred before the

State Office of Administrative Hearings (“SOAH”) from January 15-25, 2013.2

Administrative Law Judges (ALJS) Kerrie Jo Qualtrough and Pratibha J. Shenoy

prepared a Proposal for Decision recommending that the Commission approve the

application and issue the Permit.“ NWF ﬁled exceptions to the Proposal for

Decision“ and a Motion for Rehearing5 in response to the decision by the TCEQ
Commissioners to grant the application.“

The district court ruled that TCEQ failed properly to implement the high

statutory standard imposed under the Water Code for the review of water

conservation plans before authorizing interbasin transfers. While NWF also

1
AR, Vols. 23-25, Items 374-382.
3
AR, Vol. 10, Item 133.
4
AR, Vol. 10, Item 134.
5
AR, Vol. 11, Item 143.
“AR, Vol. 11, Item 151.

I0
challenged TCEQ’s failure to comply with its rules establishing requirements for

water conservation plans for water right applications regardless of whether an

interbasin transfer is involved, the district court determined those claims to be moot

as a result of the reversal of TCEQ’s decision on the interbasin transfer issues. The

District Cou1’r’s Judgment of March 6, 2015, is ﬁnal and appealable. The Supreme

Court of Texas ordered this case transferred on April 21, 2015 from the Third Court

of Appeals.

1]
ISSUES PRESENTED

Pursuant to Rule 38.2(a) of the Texas Rules of Appellate Procedure, NWF
objects to TCEQ’s and the District’s characterization of the issues presented in this

appeal. NWF identiﬁes the following issues in this appeal:
1. Did TCEQ err in its interpretation and application of Texas Water Code Section
1l.O85(l)(2) in ﬁnding the District’s water conservation plan and

implementation satisﬁed statutory requirements?

2. Is there substantial evidence to support TCEQ’s determination that the District

demonstrated that it has implemented a water conservation plan that will result

in the highest practicable levels of water conservation and efﬁciency achievable

within the District’s jurisdiction as required by Texas Water Code Section

l1.085(l)(2)?

3. Is there substantial evidence to support TCEQ’s determination that the District’s

water conservation plan complied with the requirements of Sections 288.5

(1)(B) and (l)(H) of TCEQ’s rules?
STATEMENT OF FACTS
A. The District submitted an application to TCEQ for Water Use Permit
No. 5821 for the construction of Lake Ralph Hall and for an interbasin
transfer of water from the Sulphur River Basin to the Trinity River
Basin.

In 2003, the District ﬁled an application with TCEQ for Water Use Permit

No. 5821.7 In its application, the District sought the right to construct and maintain

a dam and reservoir along the North Sulphur River, a tributary of the Sulphur River

in Fannin County, Texas. The District applied for the right to impound up to 180,000

acre-feet of state-owned water in this reservoir (Lake Ralph Hall) and to divert and

put to beneficial use up to 45,000 acre-feet per year of that water, of which 34,082

acre-feet per year is available on a ﬁrm basis. Additionally, the application sought

authorization of an interbasin transfer allowing the transfer of up to 45,000 acre-feet

of water per year of the impounded water, from the reservoir located in the Sulphur

River Basin, to the Trinity River Basin where the bulk of the District’s customers

are and where the District asserts much of the water would be put to beneﬁcial use.

B. The Parties participated in a contested case hearing at State Office of
Administrative Hearings.

TCEQ received many requests for a contested case hearing on the District’s
application, including a number from individuals} The hearing requests of NWF,
the Town of Flower Mound, and the Texas Conservation Alliance were granted by

7
AR, Vol. 1, Item 1.
8
AR, Vol. 2, Item 27.

13
the TCEQ Commissioners” and those parties, as well as several individuals, all were
determined to be affected persons and granted party status in the contested case

hearing,” along with the Executive Director of TCEQ and the TCEQ Office of

Public Interest Counsel. NWF submitted a hearing request in order to protect its

substantial rights, including the rights of its members," that would be affected. The

individual parties withdrew their requests prior to the hearing on the merits,” while

the Town of Flower Mound, the Texas Conservation Alliance and NWF participated

in the full evidentiary SOAI-I hearing from January 15-25, 2013.” During this

hearing, NWF provided evidence on and raised a number of issues, including

challenges to the adequacy of the District’s water conservation plan and its

implementation of that plan.

ALJs Kerrie Jo Qualtrough and Pratibha J. Shenoy issued a Proposal for

Decision and the parties were allowed the opportunity to tile exceptions and

responses.“ The ALJs submitted their response to the exceptions to the TCEQ
Commissioners.'5

9
AR, Vol. 5, Item 68.
'0
AR, Vol. 5, Item 70.
" NWF identiﬁed members owning land within the footprint of the reservoir that would be
inundated if the reservoir were built and who shared NWF’s organizational concerns. See AR,
Vol. 5, Item 64.
'3
AR, Vol. 5, Items 59-62, 71; Vol. 6, Item 83.
‘3
AR, Vol. 23, Items 374-376; Vol. 24, Items 377-379; and Vol. 25, Items 380-382.
"‘
AR, Vol. 10, Item 133.
*5
AR, Vol. 11, Item 144.
14
C. TCEQ granted the District’s application for Water Use Permit No.
5821.
The Commissioners voted to grant the application and issue the Permit at their

September 24, 2013 public hearing.” The order approving the application was

issued on October 2, 2013 and mailed to the parties on October 10, 2013.”

NVVF timely ﬁled a Motion for Rehearing of this matter on October 31,

2013.” TCEQ made no ruling on the Motion for Rehearing and it was overruled by
operation of law on November 27, 2013.” NWF timely filed its Original Petition in

this matter on December 26, 2013.

D. District Court determined that TCEQ erred in granting the District’s
permit due to lack of compliance with Water Code Section 11.085 (l)(2).
Judge Scott Jenkins, for the 126th District Court of Travis County, held that

TCEQ had not met statutory requirements before issuing the permit authorizing an

interbasin transfer under Water Code Chapter 11.085 (l)(2) and reversed and

remanded that portion of the Final Order back to TCEQ. NWF’s appeal also raised

the issue of TCEQ’s failure to comply with its rules regarding water conservation

plans even in the absence of an interbasin transfer. However, based on the ruling that

TCEQ had not complied with Section 11.085 (l)(2), all other claims were deemed

moot. The District Court’s Judgment of March 6, 2015, is ﬁnal and appealable. The

'6
AR, Vol. 26, Item 384.
” AR, Vol. 1l,Item 151.
'3
AR, Vol. 11, Item 148.
'9
AR, Vol. 11, Item 150.

I5
Supreme Court of Texas ordered this case transferred on April 21, 2015 from the

Third Court of Appeals.

16
SUMMARY OF THE ARGUMENT
This case presents the first consideration in a contested case hearing context

of the requirements of Section 11.085 (l)(2) of the Water Code, which allows for the

granting of an application for an interbasin transfer” only upon satisfaction of what

is by far the most stringent water conservation language in Texas law. Pursuant to

that provision, TCEQ is only allowed to grant an application involving an interbasin
transfer if the applicant has developed and implemented a water conservation plan

that will result in the highest practicable levels of water conservation and efficiency

achievable within the applicant’s jurisdiction. TCEQ applied that requirement in a

manner that deprived the statute of its plain meaning and of any practical effect.

All water right applications are subject to a requirement for the development

of a water conservation plan, which must include quantiﬁed conservation goals and

measures to achieve those goals. Those plans must provide for a reasonable level of

water conservation. The plain language of Section 11.085 (l)(2) imposes additional,

and very stringent, water conservation requirements for applications involving

interbasin transfers such as the one at issue here. In 2003, the Legislature directed

TCEQ, in partnership with the Texas Water Development Board, to develop model

2°
As set out in Section 1 1.085 (a) of the Water Code, an interbasin transfer involves taking or
divening water from one river basin in the state and transferring the water to any other river
basin. As provided by Section [1.085 (V), some interbasin transfers are exempted from most of
the requirements of Section 11.085. The transfer at issue here does not qualify for that
exemption.

17
conservation programs that suggest best management practices, also known as

BMPs, for achieving the highest practicable levels of water conservation and

efficiency achievable. TCEQ has not done so and has not developed rules or

guidance interpreting Section 11.085 (l)(2).

Instead, TCEQ relied on another document developed by a volunteer task

force for a different purpose to guide its application of that statute. It did so even

though the task force, on which the Executive Director of TCEQ sewed, expressly

stated that the document, known as Report 362 or the BMP Guide, was not intended
as a regulatory document and not intended to infomi compliance with the interbasin

transfer water conservation requirement. Instead, it is intended as a resource

describing commonly used best management practices for water conservation from

which users are encouraged to pick and choose components to incorporate in

developing routine water conservation plans and recommendations. Report 362 is a

voluntary guide that includes a single, multi-component best management practice

designed for wholesale water providers like the District.

Relying on the voluntary nature of the document, TCEQ allowed the District
to pick and choose components of that single best management practice to include

in its water conservation plan. The District provided no explanation or justification

for failing to include various components of that BMP in its plan. Indeed, the District

did not even retain a water conservation expert to help it develop a water

18
conservation plan to comply with that stringent criterion. Moreover, the water

conservation plan does not specify the level at which various conservation measures

are to be included. Thus, for example, the District’s program to provide irrigation

system evaluations includes no indication of the level of effort or amount of

evaluations proposed to be undertaken.“ In effect, under TCEQ’s approach, an

evaluation of a single irrigation system is credited the same as an evaluation of

10,000 irrigation systems in assessing compliance with the “highest” practicable

levels of water conservation and efficiency achievable. Despite the statutory

directive, TCEQ never attempted to determine the highest practicable levels of water
conservation and efficiency achievable within the District's jurisdiction or the

adequacy of the District’s plan to accomplish those levels.

TCEQ also failed to review the District’s implementation of its water

conservation plan, as required by Section 11.085 (l)(2). The only review of the

adequacy of actual implementation was undertaken by NWF’s water conservation

expert, who determined that the implementation reports available from the District

did not indicate implementation of key components of the plan and certainly did not

document implementation demonstrating that the plan “will result” in the highest

practicable levels of water conservation and efficiency achievable. The record is also

3‘
AR, Vol. 18, Item 239 at p. 13, Section 5.8. Actually, the plan describes what an evaluation
“could" consist of rather than a commitment to any actual program. Id.

19
devoid of evidence demonstrating the level at which the water conservation plan will

be implemented in the future.

The District’s water conservation plan also fails to comply with even the

limited explicit water conservation requirements that are applicable for all water

right applications. First, the District’s plan fails to provide any description or

explanation of a means for enforcement, which is a speciﬁc requirement of TCEQ’s

rules and critically important for successful implementation. Second, although the

District’s plan does include numerical goals to be achieved, it fails to provide the

explanation of the basis for the development of those goals that is required by

TCEQ’s rules and is necessary to evaluate the reasonableness of the goals.

TCEQ’s treatment of Section 11.085 (l)(2) deprives that provision of any

independent meaning and is arbitrary and capricious and an abuse of discretion. In

addition, TCEQ’s ﬁndings of compliance with Section 11.085 (l)(2), and 30 TAC
§§288.5 (1)(B) and (l)(H) are not supported by substantial evidence. A key question
in this appeal is whether the Legislature’s explicit prerequisite to the granting of an

interbasin transfer will be given meaningful effect. TCEQ, in its decision process in
this matter, rendered it ineffectual. In addition, TCEQ failed to follow its own

regulations regarding contents of water conservation plans accompanying

applications for water rights, resulting in a decision that is arbitrary and capricious,

an abuse of discretion, and is not supported by substantial evidence.

20
ARGUMENT
A. Standard of Review:

The scope of judicial review of a state agency decision in a contested case is

as provided by the law under which review is sought." If, as is true here, the

underlying statute does not prescribe the standard of review, the substantial evidence

rule applies. The “Texas Water Code does not define the scope of judicial review of

a decision of the TCEQ, and thus [the court] review[s] under the ‘substantial

evidence’ standard.” Nadaf v. Texas Comm '11 an Enviromnental Quality, No. 04-13-

00068-CV (Tex. App. 2014). According to the substantial evidence standard, the

court:

(2) shall reverse or remand the case for further proceedings if substantial

rights of the appellant have been prejudiced because the administrative

ﬁndings, inferences, conclusions, or decisions are:

(A) in violation of a constitutional or statutory provision;

(B) in excess of the agency's statutory authority;

(D) affected by other error of law;

33
Tex. Gov’t Code Section 2001.172

21
(E) not reasonably supported by substantial evidence considering the

reliable and probative evidence in the record as a whole; or

(F) arbitrary or capricious or characterized by abuse of discretion or
99]]
clearly unwarranted exercise of discretion.

For purposes of evaluating the existence of substantial evidence under Texas

law, “in conducting a substantial-evidence review, [the Court] must detemiine

whether the evidence as a whole is such that reasonable minds could have reached

the conclusion the agency must have reached in order to take the disputed action.”2“

The Third District Court of Appeals in Austin has elaborated on the arbitrary

and capricious prong of review under Texas Government Code Section 200l.l74(2)

(F):

“An agency’s decision is arbitrary and capricious or results from an
abuse of discretion if the agency: (1) failed to consider a factor that the
legislature directs it to consider; (2) considers an irrelevant factor; or
(3) weighs only relevant factors that the legislature directs it to consider
but still reaches a completely unreasonable result. City of El Paso v.
Public Util. Comm ’n, 883 S.W.2d 179, 184 (Tex. 1994). Other reasons
an agency’s decision might be considered arbitrary is if its order denies
parties due process of law or the agency fails to follow the clear
unambiguous language of its own regulations. Reliant Energy, Inc v.
Public Util. Comm ’n, 153 S.W. 3d 174, 199 (Tex. App — Austin 2004,
pet. denied).”35

13
Tex. Gov’t Code Ann. Section 2o01.174(2)
City of El Paso v. Public Utility Commission of Texas, 839 S.W.2d 895, 905-6 (Tex.App. —
34

Austin 1992). Relevant portion afﬁrmed by City of El Paso v. Public Util. Comm ‘n, 883 S.W.2d
179 (Tex. 1994).
15
State of Texas’ Agencies and Institutions of Higher Leanting et al v Public Utility Commission
ofTexas et al, 450 S.W.3d 615, 625 (Tex. App. — Austin 2014).
22
B. TCEQ erred by approving issuance of the permit in the absence of a water
conservation plan meeting the explicit statutory prerequisites of Section
11.085 (l)(2) of the Water Code.
1. Section 11.085 (l)(2) establishes an unambiguous and stringent
prerequisite to approval of an interbasin transfer.

TCEQ imperrnissibly translated the explicit, and unambiguous, statutory

prerequisite to approval of an interbasin transfer into a standardless exercise,

allowing the District to pick and choose water conservation measures to include in

its water conservation plan without requiring it to justify those decisions or to

demonstrate that the plan would result in the required levels of water conservation

and efficiency.“ TCEQ’s decision to approve the application was not supported by

substantial evidence, was arbitrary and capricious, an abuse of discretion and

otherwise not in compliance with law.” The plain language of Section 11.085 (l)(2)

of the Water Code establishes a stringent, mandatory prerequisite for approval by

TCEQ of an interbasin transfer, such as the one at issue here:

“The commission may grant, in whole or in part, an application for an interbasin
transfer only to the extent that:

3‘
Various water conservation plans were submitted by the District. The most recent one, and the
one on which the District primarily seeks to rely, and the only one in effect at the time of the
hearing, is the 2012 plan. AR, Vol. 18, Item 239. The District also submitted a 2009 Water
Conservation Plan as part of its application. AR, Vol. 18, Item 236. The 2012 plan is the version
that comes closest to meeting statutory and regulatory prerequisites and this brief addresses the
adequacy of that plan except to the extent that specific references to the 2009 plan are indicated.
NWF‘s arguments of inadequacy apply to both versions of the plans and also to earlier versions
referenced in the application.
37
This issue was raised in NWF’s Motion for Rehearing at pp. 3 — 8, pp. 9 — 10 (FOF 383-384,
FOF 438-439). 1313. 10 -13 (FOF 441-448), pp. 13 — 15 (COL 20, COL
27 — 29, COL 32-33).
23
(2) the applicant for the interbasin transfer has prepared a drought contingency
plan and has developed and implemented a water conservation plan that will
result in the highest practicable levels of water conservation and efﬁciency
achievable within the jurisdiction of the applicant.”

There are no TCEQ rules or guidance interpreting this provision.“ As the

Texas Supreme Court has directed, each word should be given effect according to

its plain meaning. City of Marshall v. City of Uncertain, 206 S.W.3d 97, 105 (Tex.

2006)(“We look first to the plain and ordinary meaning of the statute’s words.” citing

Mclntyre v. Ramirez, 109 S.W.3d 741, 745 (Tex. 2003)). Every word is to be given

effect. Id. (citing Old Am. County Mutual Fire Ins. Co. v. Sanchez, 149 S.W.3d 111,

115 (Tex. 2004) and City of San Antonio v. City of Boeme, 111 S.W.3d 22, 29 (Tex.

2003)).

The Merriam-Webster online dictionary deﬁnes practicable as “capable of

being put into practice or of being done or accomplished.”29 Similarly, the online

Merriam-Webster thesaurus defines “achievable” as “capable of being done or

carried out.”"‘° Although the definitions of the two terms are very similar, in the

AR Vol. 25, Item 380 (hearing transcript for Jan.23, 2013) at p.l633, line 14 — p. 1634, line 2.
38

TCEQ has adopted a rule that basically restates the statutory requirement. 30 TAC §297. 18
(d)(2) provides, in relevant part: “the applicant for the interbasin transfer has prepared drought
contingency and water conservation plans meeting the requirements of Chapter 288 of this title
(relating to Water Conservation Plans, Drought Contingency Plans, Guidelines and
Requirements) and has implemented a water conservation plan that will result in the highest
practicable levels of water conservation and efficiency achievable within the jurisdiction of the
applicant."
29
Merriam-Webster, http://www.merriam—webster.corri/dictionary/practicable (last visited July
26, 2015).
3°
Merriam-Webster, http://www.merriam—webster.conilthesaurus/achievable (last visited July
26, 2015).

24
context of the statute, they each have independent effect. Taken as a whole, Section

11.085 (l)(2) establishes that an acceptable water conservation plan must include

measures that are designed to result in the highest levels of water conservation and

efficiency which are capable of being accomplished—i.e., highest practicable.

However, an applicant may be able to show that it is not required to include in its

plan every practicable measure or to include them at the highest level if it

demonstrates that a measure or level is not capable of being done or carried out—

i.e., achievable—within the jurisdiction of the applicant.

The plain language of the provision also requires more than a showing that

such a plan has been developed. There must also be a showing that the plan has been

implemented and that the plan as implemented will result in achieving the requisite

levels of conservation and efficiency. The statute does not purport to require that the

highest practicable levels of water conservancy and efﬁciency achievable must have

already been reached before an application is granted. The plain language does,

however, require a showing, given the existing, and ongoing, implementation of the

plan, that those levels yvﬂ be accomplished.

The statute imposes that stringent water conservation and efficiency

performance standard as an additional requirement over and above less stringent

water conservation requirements that apply more broadly. Section 11.1271 (a) of the

Water Code requires that all applicants for a water right, regardless of whether an

25
interbasin transfer is involved, must formulate and submit a water conservation plan

and adopt reasonable water conservation measures. In addition, Section 11.134

(b)(4) of the Water Code provides that a water right application can only be granted

if the applicant provides evidence that it will use reasonable diligence to avoid waste

and achieve water conservation. TCEQ has adopted rules to implement those basic
water conservation requirements.“ As explained by Mr. Gooch, the District’s water

conservation expert witness, rather than imposing substantive standards, the rules

implementing those two provisions, with lirrrited exceptions, primarily require only

that water conservation plans must address certain issues instead of imposing a

speciﬁc substantive standard for water conservation measures or efﬁciency that must

be met.” The plain language of Section 11.085 (l)(2) stands in sharp contrast to the

general requirements for “reasonable” measures and “reasonable” diligence.

In order to give independent meaning to Section 11.085 (l)(2), a standard for

a water conservation plan that is much more stringent than reasonable diligence must

be enforced. In derogation of that clear legislative directive, TCEQ granted the

3'
Those rules are found in 30 TAC Chapter 288 and Section 295.9. The Chapter 288 rules
speciﬁcally applicable to wholesale water providers such as the District are found in Section
288.5. Chapter 288 requirements are also expressly made applicable, through 30 TAC Section
297.18 (d)(2), to applicants seeking an interbasin transfer.
33 “I
believe that the 2009 UTRWD
Water Conservation Plan addresses each of the issues that
are speciﬁed in the applicable TCEQ rules, and I believe the District’s plan therefore satisﬁes
TCEQ’s requirements.” AR, Vol. 18, Item 11 (Direct testimony of Tom Gooch) at p. 68, line 4 -
p. 69, line 15. As discussed further below, Mr. Gooch was unable to point to any basis for
asserting that requirements had been met for a description of enforcement mechanisms or for the
basis of numerical goals.

26
District’s application for an interbasin transfer based on a water conservation plan

that fails to satisfy the rules governing even that reasonable diligence level of water

conservation and that fails to comply with the plain language of the statute. TCEQ
did so by relying, at the District’s behest, on a document called the Water

Conservation Best Management Practices Guide (also known as the BMP Guide or
Report 362), which is a voluntary guidance document designed for use outside of

the regulatory context to inform the development of routine water conservation

programs. Based on the language of Report 362, TCEQ allowed the District to pick
and choose measures from Report 362 to include in its plan, without justifying the

exclusion of measures or the extent to which measures are included. TCEQ relied
on Report 362 instead of adopting rules or producing the model water conservation

plans the Legislature directed TCEQ to develop to help inform the implementation
of Section 11.085 (l)(2) and without making a reasoned evaluation of the highest

practicable levels achievable.

The District also failed to undertake a review of the highest practicable levels

achievable, failing even to retain, among the many technical experts working on the

application, a water conservation expert to help it develop its water conservation

plan and program.“ The District did retain a water conservation expert to testify in

33
AR, Vol. 23, Item 374 (hearing transcript for Jan. 15, 2013) at p. 44, line 12 — p. 47, line 14.

27
defense of its plan and water conservation program after it was developed.“ He

acknowledged that he did not evaluate potential additional conservation measures

the District might undertake beyond those included in its water conservation plan.”

2. TCEQ ignored the plain language of Section 11.085 (l)(2) and
allowed the District to choose what levels of conservation and
efficiency to include.

The Legislature’s intent in establishing a strong requirement is reﬂected both

in the language chosen to deﬁne the test and in its decision to make compliance an

explicit prerequisite to approval of an application. In amending Section 11.085 in

1997, the Legislature imposed a signiﬁcant review process for interbasin transfers.

However, most subsections of Section 11.085 direct TCEQ to consider various

factors in reaching a decision about whether to approve an application. By contrast,
in Subsection (1) the Legislature imposed two explicit prerequisites to approval. Only

the second of those—Subsection (l)(2)—is at issue in this appeal.

Subsection 11.085 (l)(2) imposes a three-part test. First, the applicant must

have prepared a drought contingency plan, which imposes measures to reduce water

use during drought conditions over and above the water conservation and efﬁciency

measures that are in effect at all times. Compliance with that drought contingency

component is not challenged in this appeal. Second, the applicant must have

developed a water conservation plan strong enough that, if implemented, it will

34
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 863, line 23 — p. 864, line 4.
35
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 889, line 23 — p.890, line 3.
28
$11; in the highest practicable levels of water conservation and efficiency

achievable within the applicant’s jurisdiction. The third component requires the

applicant to demonstrate that it has implemented the water conservation plan in a

way that will result in the highest practicable levels of water conservation and

efficiency achievable. The issue of inadequate implementation of the District’s water

conservation plan is addressed under heading C, below.

As acknowledged by TCEQ’s water conservation witness, TCEQ has not

adopted any policy or guidance that informs the interpretation of the water

conservation requirements for interbasin transfers.” That is true even though the

Legislature, in 2003, expressly directed TCEQ, in partnership with the Texas Water
Development Board, to “develop model water conservation programs for different

types of water suppliers that suggest best management practices for achieving the

highest practicable levels of water conservation and efﬁciency achievable for each

speciﬁc type of water supplier.” Section 11.1271 (e), Water Code." Although such

model programs might not deﬁne precisely what is required to comply in each

AR Vol. 25, Item 380 (hearing transcript for Jan. 23, 2013) at p.1633, line 14 — p. 1634, line 2.
36

TCEQ has adopted a rule that basically restates the statutory requirement. 30 TAC §297.l8
(d)(2) provides: “the applicant for the interbasin transfer has prepared drought contingency and
water conservation plans meeting the requirements of Chapter 288 of this title (relating to Water
Conservation Plans, Drought Contingency Plans, Guidelines and Requirements) and has
implemented a water conservation plan that will result in the highest practicable levels of water
conservation and efficiency achievable within the jurisdiction of the applicant."
37
That requirement was imposed in H.B. 2660, Chapter 688, 78"‘ Legislature Regular Session
2003. The agencies were directed to complete that task by September I, 2004. Id. at SECTION
6.

29
particular circumstance, they would provide relevant guidance regarding

conservation plans speciﬁcally designed to result in the highest practicable levels of

water conservation and efficiency achievable.

In the absence of the model conservation programs required by Section

11.1271 (e) or other guidance deﬁning compliance with 11.085 (l)(2), TCEQ
erroneously relied on Report 362, which was prepared by a volunteer Water

Conservation Implementation Task Force (“Task Force”) in response to an entirely

different legislative directive and for a different purpose, as establishing the

standard.” As the attorney representing the Executive Director in this matter

explained to the TCEQ commission when he was asked about NWF’s contention

that Report 362 is not appropriately used as the guide for highest practicable levels

of water conservation and efﬁciency achievable: “if that guide isn‘t that, then one

doesn’t exist. It is the only statement, by either this Commission or the Water

Development Board, that directs any form of best management practice for water
”-19
conservation

33
Senate Bill 1094, enacted in 2003, established the Water Conservation Implementation Task
Force and charged it with six enumerated duties and directed it to “develop a best management
practices guide for use by regional water planning groups and political subdivisions responsible
for water delivery service" and to make a ﬁnal report. Although developed by the Task Force,
Report 362 was published by the Texas Water Development Board.
39
AR, Vol. 26, Item 384, CD recording of TCEQ Sept. 24, 2013 Agenda Session. An unofficial
transcript of that portion of the agenda session is included in the Appendix.

30
Simply put, he is correct: no guide for highest practicable levels of water

conservation and efficiency achievable exists because TCEQ failed to implement the
explicit directive of Section 11.1271 (e) of the Water Code and has not adopted rules

or other guidance elaborating on the requirements of Section 1 1.085 (l)(2). However,

that failure does not make Report 362 an acceptable substitute, and it was arbitrary

and capricious and an abuse of discretion for TCEQ to apply a voluntary guide

developed for an entirely different purpose in the manner done here. There simply

is no defensible construction of the language of Section 11.085 (l)(2) that

countenances allowing an applicant to pick and choose which reasonably available

measures to include and at what level without requiring a justification for the

decisions in terms of the impact on the levels of water conservation and efficiency

that would result. NWF has not argued that Report 362 is irrelevant to the inquiry,
but, rather, that it is not sufficient as a test of compliance.

3. Report 362 is not an adequate test for compliance with Section
11.085 (l)(2)

In 2004, the Task Force expressly addressed the appropriateness of using

Report 362 in the way TCEQ has chosen to do: “The Task Force understands that a
question has arisen as to how the BMP Guide might relate to the water conservation

criteria to be used by TCEQ in reviewing and acting on applications for interbasin

transfers of surface water. The Task Force is not attempting through the BMP

31
Guide or the water conservation targets or goals to make that deterrnination.”“° The

Task Force also explained that “[t]he BMP Guide is not a regulatory document.”"'
Both the Executive Administrator of the Texas Water Development Board at the

time (Kevin Ward) and the Executive Director of TCEQ at the time (Glenn Shankle)

were members of the Task Force that concluded Report 362 was not intended to

serve as the water conservation criterion for approval of interbasin transfers or as a

regulatory document.“

The Legislature also signaled its intention that Report 362 would not be an

appropriate substitute for the model water conservation programs required under

Section 11.1271 (e). The development of Report 362 was mandated by the

Legislature pursuant to S.B. 1094, which was reported as enrolled on May 6, 2003.43

On May 30, 2003, H.B. 2660, which added Section 11.1271 (e) directing TCEQ and

4°
AR, Vol. [9, Item 269, (Special Report) at pp. 17-18. TCEQ, in its brief, at p. 31, cites to a
portion of an updated version of Report 362, which was developed after the hearing and is not in
the record, contending that the successor entity to the Task Force has conﬁrmed the connection
between Report 362 and H.B. 2660. Even if it were in the record and could be considered, the
revision does not actually indicate anything about Report 362 addressing the requirements of
Section 11.1271 (e), or highest practicable levels of water conservation and efﬁciency, or
interbasin transfers. The Task Force charge discussed in the update, as it relates to Report 362,
comes from S.B. 1094. In addition, that introduction accompanies a revised version of Report
362, including a revised BMP
for wholesale water providers, and not the version considered in
the hearing. The relationship between H.B. 2660 and S.B. 1094 is discussed in the text
accompanying footnotes 43 and 44.
4'
Id. Item 269 at p. 15.
"3
Id. Item 269 75 and 77.
at pp.
S.B. 1094, 2003 Leg., 78(R) Sess. (Tx. 2003), available at
‘*3

http://www.capitol.state.tx.us/tlodocs/78R/billtext/pdf/SB0lO94F.pdf#navpanes=0. Date
reported enrolled available at
http://www.capitol.state.tx.us/BiIlLookup/Actions.aspx?LegSess=78R&Bill=SB 1094.

32
TWDB to develop those model conservation programs, was reported as enrolled.“
If the Legislature had intended that Report 362 could be used to deﬁne highest

practicable levels of water conservation and efficiency achievable, there would have

been no reason to enact Section 11.1271 (e). Acceptance of TCEQ’s interpretation

would impermissibly deprive Section 11.1271 (e) of independent effect. Texas

Workers’ Comp. Comm '11 v. Cont'l Cas. C0., 83 S.W.3d 901, 905 (Tex. App. — Austin

2002) (Statutes are interpreted by considering the entire statute, not just disputed

provisions. Disputed provisions are to be considered in context, not in isolation.

Courts consider such things as the circumstances under which the statute was

enacted, former statutory provisions on the same or similar subjects, and the

consequences of a particular construction when interpreting statutes. We do not give
one provision an interpretation that is inconsistent with the other provisions of the

act.)(Intemal citations omitted)

NWF’s water conservation expert, Chris Brown, served as one of the

consultants drafting Report 362,45 and he testified that the consultants involved in

44
H.B. 2660, 2003 Leg., 78(R) Sess. (Tx. 2003), available at
http://www.capitol.state.tx.us/tlodocs/78R/biIltext/pdf/HB02660F.pdf#navpanes=O. Date
reported enrolled available at
http://www.capitol.state.tx.us/BillLookup/Actions.aspx?LegSess=78R&Bill=HB2660.
‘*5
AR, Vol. 22, Item 357 (direct testimony of Chris Brown) at pp. 1 1-12. Contrary to the
District’s negative characterization of Mr. Brown's qualiﬁcations, not only was he chosen to
help write Report 362 but he has worked extensively on water conservation issues in Texas both
in developing and directing water conservation programs for the San Antonio Water System and
as a consultant for a number of water suppliers. In addition, his more recent work in California

33
that process were never directed to identify the highest practicable levels of water

conservation and efﬁciency achievable.“ That testimony was undisputed. He also

testified that, although relevant as a starting point for identifying potential water

conservation measures, the best management practices in Report 362 do not

represent the highest practicable levels of water conservation and efficiency

achievable because, among other things, Report 362 represented an effort to achieve

consensus of the Task Force members in identifying widespread practices commonly

used in 2004 that might be considered for voluntary implementation. Mr. Gooch, the

District’s water conservation witness, acknowledged that he knew of no language in

H.B. 2660, S.B. 1094, or in Report 362 indicating that the best management practices

in Report 362 are adequate to achieve the highest practicable levels of water

conservation and efﬁciency achievable.“ Because of the purpose for which it was

prepared, Report 362 heavily stresses its voluntary nature, allowing users to pick and

choose measures to implement. TCEQ compounded the error of relying on Report
362 as a substitute for determining the highest practicable levels of water

conservation and efficiency achievable by using that voluntary aspect to excuse the

District’s failure even to incorporate in its water conservation plan many of the

includes signiﬁcant involvement in development and implementation of water conservation
plans, including bestmanagement practices (BMPS). Id. at p. 6, line 13 — p. 10, line 6.
46
Id. at p 14.
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at 915, lines 3 — 13.
‘*7
p.

34
relevant measures recommended in Report 362 or to justify their exclusion. Relying

on Report 362 in this manner deprives the term “highest” in Section 11.085 (l)(2) of

meaning. The arbitrariness of relying on Report 362 to deﬁne the standard for

regulatory compliance with the highest practicable levels of water conservation and

efficiency achievable is further illustrated by the explicit acknowledgement in the

Report that “[t]he BMPs are not exclusive of other meaningful conservation

techniques that an entity might use in formulating a state-required water

conservation plan.”“8

The plain language of Section 11.085 (l)(2) precludes the use of a voluntary

approach that defers to an applicant to pick and choose what level of conservation

to provide, particularly an approach that does not require the applicant to justify its

decision to omit potentially applicable measures. TCEQ’s use of Report 362 in this

manner deprived the plain language of Section 11.085 (l)(2) of practical effect.

TCEQ never actually evaluated the h_ig@ practicable levels of water conservation
and efficiency achievable within the District’s jurisdiction, as the Legislature

directed it to do, to see if the District’s plan met that standard. Instead, TCEQ just
looked at Report 362 and reviewed the recommended measures in the Region C
Water Plan.” However, as discussed below, many of the conservation measures

43
AR, Vol. 22, Item 368, (excerpt from Report 362), at p. 4.
49
AR, Vol. 25, Item 380 at p. 1638, line 2 — 24.

35
included in those two documents actually are missing from the District’s plans,

without justiﬁcation.

Not only did the District fail to provide any justification for its failure to

include many of the measures listed in Report 362 or the Region C Water Plan, as
discussed below, the enforcement component essential for showing even a

reasonable diligence level of water conservation is missing. That component is

mandated by TCEQ’s rules and also called for in Report 362.50 Mr. Brown

characterized the District’s water conservation plan as weak explaining that it lacks

speciﬁc programs for the District’s customers to implement, lacks speciﬁcity, is not

adequately funded and that, because, in many instances, it merely encourages its

customers to take various measures, the measures are unenforceable and can’t be

counted on.“ There is only one best management practice—BMP 2.14—in Report

362 that is directed specifically at wholesale water providers like the District. The

consideration of Report 362 in the hearing focused on that single BMP. BMP 2.14
has numerous subpans and the District’s water conservation plan fails to include

many of the measures called for in those subparts. Although drafted as voluntary

guidance, the BMP notes that “[t]o implement this BMP, the following elements and

5°
30 TAC Section 288.5 (l)(H). Report 362 also recommends the adoption of penalties as a
means to enforce implementation. AR, Vol. 22, Item 368, (Exh. NWF 9; excerpt from Report
362), at p. 79, in Item 4.
5'
AR, Vol. 22, Item 357 (direct testimony of Chris Brown) at p. 22 — p. 29, line 5.

36
strategies should be included” and then lists speciﬁc content,” much of which is

missing from the District’s plan. The District provided no justiﬁcation for those

omissions. For example, Item 2 of BMP 2.14, on page 79, references the need for a
plan to include quantiﬁed five and ten—year targets and the basis for the development

of those targets, which are also referred to as goals. Although the District’s plan does

include such goals, as its water conservation witness acknowledged, the basis for the

development of the ﬁve and ten-year goals is missing from the District’s plans.”

Item 4 in BMP 2.14 indicates the wholesale agency should consider developing and
adopting some form of penalties for non-compliance with the requirement that its

wholesale customers implement adequate water conservation plans. No such

penalties, or similar compliance incentives, are identiﬁed or discussed in the

District’s plan.”

Item 6 in BMP 2.14 has six subparts. Mr. Gooch testiﬁed that with respect to
subpart 6.c., which refers to development of procedures for calculating program

savings, costs and beneﬁts, he didn’t know if the District had the referenced

procedures.” With respect to 6.d., which relates to conservation incentive activities

such as pooling funds to purchase ultra-low-ﬂush toilets, he didn’t know if the

53
AR, Vol. 22, Item 368 (excerpt from Report 362), at p. 78, in Item C.
53
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18,2013) at p. 919, line 24 - p. 923, line 25.
54
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18,2013) at p. 924, line - p. 925, line 2.
1
55
AR, Vol.24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 928, line 25 — p. 929, line 3.
37
District coordinated any conservation incentive activities.“ Regarding item 6.f., he

didn’t know about any rebates and stated that he wasn’t sure what a retroﬁt program
was.57 Mr. Gooch also indicated he didn’t know if copies of progress reports of

BMPs implemented by wholesale customers were collected in accordance with item
F.4).58 Nothing in the District’s water conservation plan addresses any of those

issues. Mr. Brown also testiﬁed about other aspects of BMP 2.14 that are missing
from the District’s plan.”

4. The Region C Water Plan conservation recommendations do not
justify reliance on Report 362 or demonstrate compliance with
Section 11.085 (l)(2)

TCEQ also sought to justify its reliance on Report 362 by referring to the

water conservation discussion in the regional water plan for Region C.5° That effort

was supported by District’s water conservation witness, Mr. Gooch, who served as

the project manager for the consultant team involved in developing the Region C
plan and as the person primarily responsible for developing the language of the

56
929, lines 4-7.
Id. at p.
5*
929, lines 8-16.
Id. at p.
5“
Id. at p. 929, line 2l—p. 930, line 1.
59
AR, Vol. 22, Item 357 (direct testimony of Chris Brown) at p. 23, line 1 — 21 (additional
missing aspects include guidelines for customer ordinance components, speciﬁc reporting
requirements, and a schedule and scope for the programs that are included).
6°
Region C is the region in which both the proposed reservoir, which is proposed to be built in
the Sulphur River Basin, and the District's service area, which is primarily in the Trinity River
Basin, are located. The Administrative Law Judges took official notice of the 201 1 Region C
Water Plan, which was the current plan at the time of the hearing. The basic statutory provision
creating the regional water planning process is Section 16.053 of the Water Code. Section 16.053
(a) provides a general overview of the charge to regional water planning groups in developing
regional water plans.

38
plan.“ The language of the Region C Water Plan stating the contention that Report
362 fulﬁlls the directive of Section 11.1271 (e) of the Water Code matches Mr.

Gooch’s testimony.“ However, that is an issue of statutory interpretation, which is

a question of law, not one of fact. See Johnson v. City of Fort Worth, 774 S.W.2d

653, 656 (Tex. 1989). Accordingly, neither the Region C Water Plan nor Mr.

Gooch’s testimony to that effect have probative value on the issue.

The Legislature, in another subsection of Section 11.085, expressly dictated

the role of water conservation recommendations in the relevant regional water plan

when TCEQ is considering an interbasin transfer of water. Section 11.085 (k)(2)(c)

of the Water Code directs the Commission, when determining whether to authorize

an interbasin transfer, to consider factors in the relevant regional water plans

addressing “proposed methods and efforts by the receiving basin to avoid waste and

implement water conservation and drought contingency measures.” (Emphasis

added)“

Thus, the adequacy of recommendations of the Region C Water Plan about

proposed methods and levels of efforts to avoid waste and implement water

conservation and drought contingency measures throughout the receiving basin was

AR, Vol. p.933, line 20 — p. 934, line 21.
6'
24, Item 377 (hearing transcript for Jan. 18, 2013) at
61
AR, Vol. 22, Item 368 (Section 6 of 201 1 Region c Water Plan) at p. 6.47: “The TWDB and
TCEQ have addressed this [Section 1.1271 (e)] requirement by preparing
I Report 362, TWDB
the Water Conservation Best Management Practices Guide.” Mr. Gooch stated the same opinion.
AR, Vol. 18, Item 218 (direct testimony of Tom Gooch) at p. 79, lines I — 9.
"3
Region C is the proposed receiving basin for this interbasin transfer.

39
one of the factors the Commission was required to consider in reviewing whether

the application should be granted. In directing that review, the Legislature

recognized that it may not be appropriate to allow state—owned water to be taken

from another basin if the receiving basin is allowing water to be wasted or is

otherwise not implementing adequate water conservation and drought contingency

measures. However, that is a separate consideration from whether the drought

contingency plan and the water conservation plan developed by the and
'

District, its

implementation of that plan, meet the requirements of Section 11.085 (l)(2). Neither

the Water Code nor any TCEQ rule indicates that a regional water plan is to be

looked to in defining what levels of water conservation and efficiency would be

adequate to meet the requirements of Section 11.085 (l)(2). And, regardless, the test

used must give full effect to the statutory language.

A comparison of the Region C Water Plan water conservation

recommendations to the District's water conservation plan does serve to further

illustrate the failure of the District’s plan to comply with Section 11.085 (l)(2).

Although merely including all of the water conservation measures recommended in

the Region C Water Plan in the District’s water conservation plan would not

demonstrate compliance with that standard?“ the complete absence of some

6‘
There has been no showing that the conservation measures recommended in the Region C
Water Plan are sufficient to result in the highest practicable levels of water conservation and
efficiency achievable within any particular entity’s jurisdiction. For example, the plan merely

40
measures that are recommended for implementation by other water suppliers, or, at

minimum, the absence of a justification for excluding such measures, does further

demonstrate that the plan falls short of one that will result in the highest practicable

levels of water conservation and efficiency achievable. Under any reasonable test

for compliance with that statutory standard, the failure to incorporate widely

recommended measures, or show why they are not appropriate for inclusion,

represents a fatal ﬂaw. The District’s water conservation plan fails to include two of

the specific water conservation measures—a coin-operated clothes washer rebate

program and landscape irrigation restrictions——that are recommended in the Region

C Water Plan for implementation by a large number of water suppliers across the

region. The vast majority of those water suppliers are not seeking to authorize

interbasin transfers of water and are not subject to the heightened water conservation

standards of Section 11.085 (l)(2) .

The 2011 Region C Water Plan recommends two tiers of water conservation

measures applicable for municipal use, which is the predominant type of use

currently supplied by the District and one of three types of uses requested for

approval in the Permit that is the subject of this lawsuit.“ As Mr. Gooch testified on

listscertain conservation measures and does not specify the levels at which measures would need
to be implemented. The plan also acknowledges that water conservation measures were studied
only at the regional level and that more detailed studies for individual suppliers might indicate
different results. AR, Vol. 22, Item 368 at p. 6.49. Again, that individualized review of highest
practicable levels achievable is missing.
“5
AR Vol 22, Item 367 (excerpt from 201 1 Region C Water Plan) at pp. 6.47-6.49.
4-1
behalf of the District, the 2011 Region C Water Plan recommends a “basic” tier of
seven conservation measures for each municipal entity that has a demand greater

than supply and has a gallons-per-capita-per-day use greater than 140.“ Other than

educational programs and a conservation rate structure, the basic tier consists of

measures that quantify savings anticipated from implementation of legal

requirements that are imposed under existing law without action by the water

supplier.“

The “expanded” tier of ﬁve measures, which includes items requiring more

effort by the water supplier, is recommended for 145 out of 277 water user groups.“

One of the measures included in that tier is a coin-operated clothes washer rebate

program designed to get more efficient washers installed in commercial laundries.

As Mr. Gooch acknowledged, the District’s water conservation plan has no such

rebate program and he is not aware of any reason that would prevent it from having

one.“ Mr. Brown, NWF’s water conservation expert, conﬁrmed the absence of any

rebate programs in the District’s plan; explained the importance of rebate programs,

as part of a financial assistance program, in achieving effective water conservation;

and indicated the critical role wholesale water providers can play in implementing

6°
AR Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at pp. 881-84.
67
Id.
68
Id. at p. 885, lines 7 -15.
885, line 19 — p. 886, line
69
Id. at p. 9.

42
them.7° Rebate programs are one of the speciﬁc elements listed in BMP 2.14 in

Report 362.7‘

A second measure included in that expanded tier of the 2011 Region C Water
Plan is landscape irrigation restrictions. Although the District’s 2012 water

conservation plan does “urge” its customers to include time of day and day of week

landscape watering strategies in their water conservation plans, the District has not

made landscape irrigation restrictions a required component of its conservation

plan." That is true even though the District is contractually obligated to implement

a water conservation program that is at least as stringent as the City of Dallas’

program, which does include mandatory time of day and day of week restrictions.”

C. TCEQ erroneously approved the District’s application even though the
demonstrated that it has implemented its water
District has not
conservation plan as required by Section 11.085 (l)(2) of the Water Code.

A second prerequisite established in Section 11.085 (l)(2) for granting an

application for an interbasin transfer is that the applicant must have implemented its

water conservation plan in a way that will result in the highest practicable levels of

water conservation and efficiency achievable within the jurisdiction of the applicant.

7°
AR, Vol. 22, Item 357 (direct testimony of Chris Brown) at p. 23, line 6 — p. 24, line 19.
7'
AR, Vol. 22, Item 368 (excerpt from Report 362) at p. 79.
This is an instance in which there is a slight difference in the District’s 2009 and 2012 water
71'

conservation plans. The 2009 plan “encourages” customers to implement a voluntary time of day
landscape watering “guideline." AR, Vol. 18, Item 236 (2009 WCP) at p. 10. The 2012 plan
“urges” customers to implement a voluntary or mandatory time of day and day of week
landscape watering “strategy.” AR. Vol. 18, Item 239 (2012 WCP) at p. 12.
13
AR, Vol. 22, Item 357 (direct testimony of Chris Brown) at p. 34, line 19 — p. 36, line 17.
43
TCEQ erroneously concluded that requirement had been met. The decision was not
supported by substantial evidence, was arbitrary and capricious, an abuse of

discretion, and contrary to law."

The record does not include substantial evidence to support a ﬁnding that the

District has actually implemented its conservation plan at the required level. Indeed,

the record indicates that the only review of implementation was the one undertaken

by NWF’s water conservation expert, who indicated that the District had not

implemented a water conservation plan that will result in the highest practicable

levels of water conservation and efﬁciency achievable. After reviewing available

information, he concluded that implementation reports prepared by the District fail

to show implementation of, among other things, technical assistance programs,

rebate programs, and landscape water conservation programs. He also indicated that

expenditures by the District are inadequate to support programs at the levels needed

to comply with Section 11.085 (l)(2) 75

The District’s water conservation witness, Mr. Gooch, testiﬁed that, with

respect to implementation, he only reviewed the content of the District’s water

conservation plan and did not review the District’s implementation of its plan, other

7‘
This issue was raised in NWF’s Motion for Rehearing at pp. 3-4, 5-6, p. 7 (FOF 339, 342,
384), p. 10 (FOF 385, 435, 438-439), p. 11 (FOF 443), p. 12 (FOF 447), p. 13 (FOF 45]) and pp.
13-15 (COL 27-29, COL 32-33).
75
AR, Vol. 22, Item 357(direct testimony of Chris Brown) at p. 29, line 8 - p. 36, line 21.
44
than any implementation speciﬁcally indicated in the conservation plans

themselves.” Both the 2009 and the 2012 plans are in evidence” and neither

includes signiﬁcant information about implementation that has occurred, much less

information adequate to support a determination that the District’s implementation

will result in the highest practicable levels of water conservation and efficiency

achievable.

Mr. Gooch also testiﬁed that he did not review the District’s contracts with its

customers or the water conservation plans of those customers." Accordingly, he has

no basis to support an opinion about the adequacy of implementation to satisfy

Section 1 1.085 (l)(2), and his broad statements to the effect that the District complied

with the statute do not constitute probative evidence that the District has

implemented a water conservation in compliance with that requirement. See, e.g.,

Jelinek v. Casas, 328 S.W.3d 526, 536 (Tex. 2010) (“’[i]f no basis for the opinion is

offered, or the basis offered provides no support, the opinion is merely a conclusory

statement and cannot be considered probative evidence, regardless of whether there

is an objection”). TCEQ argues” that, by failing to object during the hearing, NWF
waived its arguments that the conclusory testimony of Mr. Gooch does not constitute

7°
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 895, line 3-line 17.
18, Item 236 (2009 WCP) and Vol. 18, Item 239 (2012 WCP).
77
AR, Vol.
7“
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 895, line 3-line 17.
79
TCEQ Brief at p. 17.

45
probative evidence. However, regardless of whether it was objected to, conclusory

testimony does not constitute evidence of any probative value. City of San Antonio

v Pollock, 284 S.W.3d 809, 816 (Tex. 2009)(“this Court has held that such

conclusory statements [made by experts] cannot support a judgment even when no

objection was made to the statements at trial”) (citing Dallas Ry. & Terminal Co. v.

Gossett, 294 S.W.2d 377, 380 (Tex. 1956)(“It is well settled that the naked and

unsupported opinion or conclusion of a witness does not constitute evidence of

probative force and will not support a jury ﬁnding even when admitted without

objection.”)); see also, Rogers v. Texas Bd. 0fArchitectural Examiners, 390 S.W.3d

377. 389-90 (Tex. App. — Austin 2011)(“The Engineers’ affidavits, even if

unchallenged, are insufficient on their face to support judgment in the Engineers’

favor because they are conclusory, i.e., they consist of conclusions unsupported by

facts. It is well settled that the naked and unsupported opinion or conclusion of a

witness, including an expert witness, does not constitute evidence of probative force

and will not support a judgment even when admitted without objection”)

NWF is not seeking to strike that testimony. The relevant question is not

whether NWF can object now that the testimony should have been excluded from
the record. The testimony is in the record, but conclusory statements by Mr. Gooch

that the District‘s plan complies with the requirements of Section 11.085 (l)(2) , do

46
not have probative value on the issue of the adequacy of implementation because he

had no basis for that testimony.

TCEQ also argues“ that NWF was required to speciﬁcally include its

complaint about conclusory testimony in its Motion for Rehearing. However, as

noted above, NWF is not seeking to correct an error regarding the admission of the
evidence, but, instead, an error in reaching a decision that is not supported by the

evidence. NWF speciﬁcally, and clearly, put TCEQ on notice in its Motion for

Rehearing that it was challenging the sufﬁciency of evidence to support speciﬁcally

identiﬁed ﬁndings of fact and conclusions of law related to the adequacy of

implementation of the District’s plan to satisfy Section 11.085 (l)(2). That was

enough. See Texas A.B. C. v. Top of the Strip, 993 S.W.2d 242, 245-46 (Tex. App. —

San Antonio 1999) (noting adequacy of motion for rehearing that referenced speciﬁc

ﬁndings of fact as not being supported by substantial evidence and as arbitrary and

capricious). NWF was not required to brief its legal arguments in its Motion for

Rehearing. See id. at 245 (noting that a motion for rehearing need not comply with

pleadings and practice of court trials).

Similarly, TCEQ’s water conservation witness acknowledged his belief that

no review of implementation had been done as part of the agency’s processing of the

WTCEQ Brief at p. 18.

4?
application.“ That also is consistent with the conclusion in the TCEQ staff

memorandum entitled “Technical Review of Water Conservation Plan” which

states: “I_f UTRWD implements all elements of its water conservation plan, then staff
believes that the highest practicable level of conservation for UTRWD @ be

achieved.““ (Emphasis added). The staff memorandum notes the need—even to

meet that impermissible reformulation of the statutory test which substitutes “can”

for “will”—for the District to ensure implementation by its customers through its

contracts.” No enforcement mechanism for ensuring that implementation is

reﬂected in the memorandum or in the record. That TCEQ staff determination on

implementation is not adequate to support a ﬁnding of compliance with the

implementation requirement in Section 11.085 (l)(2). Nor does the testimony of the

District’s General Manager, Mr. Taylor, indicate compliance.“ The plain language

of the statute requires that the District must have developed and implemented a plan

8'
Vol. 25, Item 380 (hearing transcript for Jan. 23, 2013) at p. 1660, line 4 — line 10; see
AR,
also id. at p. 1651, line 12 -23.
33
AR, Vol. 22, Item 353 (TCEQ Memorandum, Technical Review of Water Conservation Plan)
at p. 8.
83
Id.
3"‘
As
indicated by TCEQ
in its Brief, at pages 20-21, the District’s General Manager also
testified.He did indicate that the District has certain water conservation measures it implements.
NWF does not dispute that. However, he was not offered or qualiﬁed as an expert witness on
water conservation and did not offer testimony about the adequacy of those measures or the
District's implementation to comply with Section H.085 (l)(2) or any other regulatory
requirement. The District's brief includes statements about implementation that NWF's counsel
was not able to verify in the record. See District brief at p. 8 at 31 and FN
37 and FN
accompanying test, p. 25 at FN 69 and accompanying text, and p. 28 at FN 84 and accompanying
text.

48
that will result in the highest practicable levels of water conservation and efﬂciency

achievable within its jurisdiction as a prerequisite to approval of the application.

Without a demonstration of adequate implementation, there is no basis for

determining the District’s water conservation plan, even if it were otherwise an

adequate plan, will result in anything more than a document taking up space on a

shelf.

There is not substantial evidence to support a ﬁnding that the District has

implemented its water conservation plan in a way that will result in the highest

practicable levels of water conservation and efficiency achievable. Mr. Brown, the

only expert to review actual implementation, testified that the District has not

undertaken the required implementation.

D. TCEQ erred in determining that the District’s water conservation plan
includes the means for implementation and enforcement required by
TCEQ’s rules.
The record does not support TCEQ’s determination that the District’s water

conservation plan meets the requirements of agency rules related to demonstration

of a means for enforcement.” That determination is not supported by substantial

evidence and is arbitrary and capricious.

TCEQ’s mles require that a water conservation plan for a wholesale water

supplier, regardless of whether an interbasin transfer is requested, must include “a

85
This issue was raised in NWF’s Motion for Rehearing at p.2, p. 3, p. 7, p. 9 (FOF 335), and pp.
13-14 (COL 20, 27-29, and 32-33).

49
means for implementation and enforcement, which shall be evidenced by a copy of

the ordinance, rule, resolution, or tariff, indicating ofﬂcial adoption of the water

conservation plan by the water supplier; and a description of the authority by which

the water supplier will implement and enforce the conservation plan.’’“ Compliance

with that requirement is a speciﬁc prerequisite to issuance of a permit.87 The

District’s plan does include a resolution reﬂecting the adoption of the plan” and

notes that the District’s contracts with its customers reference water conservation

and include language to the effect that customers agree to cooperate in implementing

water conservation.” That language does appear to address a potential mechanism

for implementation of the plan, although only in a cursory fashion. However, nothing

in the plan provides the required discussion of enforcement or describes the authority

by which the plan will be enforced if that cooperation is not forthcoming. TCEQ
argues that the plan’s language calling for customer’s to adopt and enforce water

3°
30 TAC § 288.5 (1)(1-r).
37
30 TAC Section 295.9 provides that an application which doesn‘t meet the requirements for
water conservation plans set out in that section is incomplete and shall not be considered by the
commission. Paragraph (2) provides that applications for wholesale water providers, like the
District, must include a water conservation plan meeting the requirements of 30 TAC Chapter
288 of TCEQ’s rules. 30 TAC Section 297.18 (d)(2) also expressly requires applicants for
interbasin transfers to comply with the provisions of Chapter 288.
‘*3
AR, Vol. 18, Item 236 (2009 Water Conservation Plan) at Appendix D and Item 239 (2012
Water Conservation Plan) at Appendix D. Although those resolutions note that the Executive
Director is directed to implement and enforce the respective plans, there is no description of the
enforcement mechanism or authority.
39
AR, Vol. 18, Item 236 (2009 Water Conservation Plan) at Sections 4.4 and 7 and Item 239
(2012 Water Conservation Plan) at Sections 4.4, 5.7, and 6.

50
conservation plans satisﬁes the requirement.” However, that is a circular argument.

It is the District’s obligation to ensure enforcement. The District has not shown that

it has a mechanism for ensuring that its customers adopt adequate plans and enforce

them. The plan has no information on how the District will enforce a requirement

that its customers develop and enforce adequate plans.

The shortcoming is not merely a technical failure to describe in the plan an

actual enforcement mechanism that exists. Neither the District’s General Manager,

Mr. Taylor,“ nor its water conservation witness, Mr. Gooch,” were able to identify

or describe any mechanism to enforce implementation of the water conservation plan

other than the District “working with" its customers. BMP 2.14 in Report 362

includes a recommendation that wholesale water providers like the District consider

developing and adopting penalties for customers that don’t comply.” Mr. Gooch

indicated that he did not see any language addressing penalties for noncompliance

in the District’s water conservation plan and that he was unaware if the District has

such penalties.” He also testified that he did not know the nature of the District’s

9°
TCEQ Brief at p. 27.
9'
AR Vol. 24, Item 374 (hearing transcript for Jan. 15, 2013) at p. 61, line 9 — p. 63, line 16.
24, Item 377 (hearing transcript for Jan. 13, 2013) at p. 844, line 1 1 — p. 845, line 22;
91
AR, Vol.
p. 848, line 10 - line 25; p. 923, line 23 — p. 926, line 8.
93
AR, Vol. 22, Item 368 (excerpt from Report 362) at p. 79, Item 4. Report 362 does not deﬁne
what types of penalties are recommended and various types of negative incentives, such as
contractual provisions providing for surcharges for failure to comply, could, arguably, serve the
purpose. However, the District’s plan has no such mechanisms.
9“
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 924, line 1 — p. 925 line 2.
51
authority to enforce the plan.” Mr. Gooch was not familiar with the District’s

contracts with its customers or even if the District actually reviews the water

conservation plans of its customers.” Mr. Brown, NWF’s water conservation expert,

did review enforcement and testified that he was not able to determine that the

District does any enforcement of its water conservation program and that his review

did not indicate effective implementation by its customers.” TCEQ’s water

conservation witness testiﬁed that he doesn’t know what happens if a customer of

the District fails to implement the water conservation plan.”

The record does include conclusory opinions from Mr. Gooch averring

compliance with the requirements of Section 288.5. However, because, as discussed

above, Mr. Gooch was unable to provide any basis for testifying about compliance

as it relates to enforcement of the conservation plan, those opinions do not constitute

probative evidence on that point, regardless of whether the testimony was objected

to. See Jelinek, 328 S.W.2d at 536 (“’[i]f no basis for the opinion is offered, or the

basis offered provides no support, the opinion is merely a conclusory statement and

cannot be considered probative evidence, regardless of whether there is an

objection”‘)(citing City of San Antonio v. Pollock, 284 S.W.3d 809, 818 (Tex. 2009),

95
AR, Vol. 24, Item 377 at p. 898, line 23 — line 25.
Id. at p. 876, lines 6 — 20.
96
97
AR, Vol. 22, Item 357 (direct testimony of Chris Brown) at p. 31, line 16 — p. 33, line 16.
93
AR Vol. 25, Item 380 (hearing transcript for Jan. 23, 2013) at p. 1662, line 18 — line 21.

52
other citations omitted), See also Duncan-Hubert v. Mitchell, 310 S.W.3d 92, 101

(Tex.App. — Dallas 20lO)(“Bare, baseless opinions will not support a judgment even

if there is no objection to their admission in evidence,” citations omitted). TCEQ
argues that, by failing to object during the hearing, NWF waived its arguments that

the conclusory testimony of Mr. Gooch does not constitute relevant evidence.”

However, regardless of whether it was objected to, conclusory testimony does not

constitute evidence of any probative value. Contrary to the arguments of TCEQ and
the District, the relevant question is not whether NWF can object now that the

testimony should have been excluded from the record. The testimony is in the record,

but it has no probative value in supporting the decision.

TCEQ also argues‘°° that NWF was required to speciﬁcally include its

complaint about conclusory testimony in its Motion for Rehearing. However, as

noted above, NWF is not seeking to correct an error regarding the admission of the
evidence, but, instead, an error in reaching a decision that is not supported by the

evidence. NWF speciﬁcally, and clearly, put TCEQ on notice in its Motion for

Rehearing that it was challenging the sufﬁciency of evidence to support speciﬁcally

identiﬁed ﬁndings of fact and conclusions of law related to demonstration of

compliance with Section 288.5 (l)(H) of the agency’s rules. That was enough. See

9”
TCEQ Brief at p. 17.
I00
Id_

53
Texas A.B. C. v. Top of the Strip, 993 S.W.2d 242, 245-46 (Tex. App. - San Antonio

1999) (noting adequacy of motion for rehearing that referenced speciﬁc ﬁndings of

fact as not being supported by substantial evidence and as arbitrary and capricious).

NWF was not required to brief its legal arguments in its Motion for Rehearing. See

Id. at 245 (noting that a motion for rehearing need not comply with pleadings and

practice of court trials).

The District argues”“ that, in order to raise issues about compliance with

Section 288.5 (l)(H) , NWF was required to challenge the 2004 determination by
the Executive Director of TCEQ that the District’s application was administratively
complete and the agency ﬁndings related to that earlier determination. NWF put
TCEQ on notice in the Motion for Rehearing and in the Original Petition that NWF
was challenging compliance with Section 288.5 (l)(H) . That was sufﬁcient.'°2

NWF could also have challenged ﬁndings about the administrative completeness

determination made by the Executive Director in 2004 but it would have been

pointless and there is no requirement to have done so.

'0'
District’s Brief at pp 31-34.
"32
The District cites Hamamcy v.
Texas State Bd. of Medical Examiners in support of its
argument but that case dealt with a Motion for Rehearing which “stated, in its entirety, that
‘[t]he presentation of the discussion at the hearing will be done from the charts of the patients
and from the records on ﬁle with the Board.”’ 900 S.W.2d 423, 425 (Tex. App.—Austin 1995,
writ denied). That stands in sharp contrast to the Motion for Rehearing in this case which cited
speciﬁc ﬁndings and conclusions and clearly stated the contention of a lack of substantial
evidence to support the determination of compliance with Section 288.5 (l)(H).

54
The District’s argument also is inconsistent with TCEQ’s review of the

application and with the testimony of its witnesses. TCEQ staff only performed its
technical review'°-l of the adequacy of the District’s water conservation plan in 2011

and included the District’s 2009 water conservation plan, the most current available

at the time, in the review for purposes of evaluating compliance with the

requirements of various agency rules, including Chapter 288, and of various

provisions of the Water Code, including Section 11.085304 The District’s water

conservation witness relied on the 2009 Plan and the 2012 Plan in asserting

compliance with the requirements of Chapter 288"” NWF also referenced in its

Original Petition,'°6 Section 297.18 (d)(2) of TCEQ’s rules as an independent basis

for requiring compliance with Chapter 288 requirements for an application involving

an interbasin transfer of water.

Moreover, there is nothing in the language of the second sentence of Section

295.9 that purports to limit the requirements in that Section solely to the

determination of administrative completeness. Administrative completeness, which

'03
The difference between an administrative review and a technical review is that an
administrative review is a check-off level review of whether various components are included
and the determination of adequacy is part of the technical review, which is also called the
substantive review. AR, Vol. 25, Item 380 at p. 1640, line 14 through p. 1641, line 1 1.
'°“
AR, Vol. 22, Item 353, at pp. 1-2.
“J5
AR, Vol. 18, Item 218 (direct testimony of Tom Gooch), at p. 67, line 19 — p. 69, line 18. The
2012 plan is discussed beginning at p. 85 of that exhibit. Rule references in Mr. Gooch’s
testimony are incorrect because of a rule change made before the hearing. Thus, for example,
what Mr. Gooch refers to as Section 288.5 (1)(I) is actually 288.5 (1)(H).
'06
Original Petition at p. 9 (Error No. 3).

55
is determined by the Executive Director of TCEQ, is only one step of the review

process and TCEQ’s rules'°7 require that water conservation plans supporting an

application must be subject to review and approval by the agency’s commission,

which, in the case of a contested application, only occurs when the proposal for

decision is presented to the commission for its consideration.

Similarly, as noted above, TCEQ’s witness was unable to provide any basis

for a determination of adequate enforcement authority. The agency’s technical

review memorandum on water conservation is devoid of any discussion about

enforcement authority or compliance with Section 288.5 (l)(H) 3°”

More specifically, the relevant water conservation plan is in the record and

there is no description in that plan of authority by which the District will enforce it.

In light of that, no testimony could provide an adequate basis in the record for a

reasonable mind to conclude that the conservation plan does include the required

means of enforcement or description of enforcement authority. See City of El Paso

v. Public Utility Commission, 839 S.W.2d 895, 905-06 (Tex.App. — Austin 1992)

(“In conducting a substantial evidence review, we must determine whether the

evidence as a whole is such that reasonable minds could have reached the conclusion

the agency must have reached in order to take the disputed action”). Testimony that

'°7
30 TAC §288.3O (3)
'08
AR, Vol. 22, Item 353.

56
the plan has a description of enforcement authority or that it complies with that

requirement when the plan itself is in the record and lacks that discussion does not

provide an adequate basis to allow a reasonable mind to conclude that the

requirement is met. Furthermore, the District’s witnesses testiﬁed that the only

enforcement mechanism the District currently employs for customers who do not

comply is to work with them.

There simply is not substantial evidence to support a ﬁnding of compliance

with 30 TAC Section 288.5 (l)(H) .

E. TCEQ erred in determining that the District’s water conservation plan
includes the required basis for the development of its five-year and ten-
year targets for water savings in accordance with TCEQ’s rules.
The record does not support a determination that the District’s water

conservation plan provides the required basis for the development of the mandated

ﬁve-year and ten-year conservation targets.'°° The TCEQ determination that the plan

complies with applicable requirements of the rules is not supported by substantial

evidence and is arbitrary and capricious.

Pursuant to TCEQ’s rules, a water conservation plan for a wholesale water

supplier must include “specific, quantiﬁed ﬁve-year and ten-year targets for water

savings including, where appropriate, target goals for municipal use in gallons per

'09
The water conservation plan to provide the required basis for its
failure of the District’s
savings targets is addressed in NWF’s Motion for Rehearing at p. 8 (FOF 332-334), p. 10 (FOF
435), pp. 13 (FOF 448) and pp. 13~vl4 (COL 20, 27-29, 32-33).

57
capita per day for the wholesa1er's service area, maximum acceptable water loss, and
the basis for the development of these goals.” 30 TAC Section 288.5 (1)(B). Those
rules apply regardless of whether an application for an interbasin transfer is

involved. As evidenced by Mr. Gooch’s testimony, the District’s plans are lacking

in any explanation of the basis for the development of the goals.‘ '° For example, the

District has not explained why the starting points, in gallons per capita per day, for

its 2009 and 2012 plans vary signiﬁcantly, with the starting point for per capita use

in the 2012 plan being shown as higher than the 2009 plan, hardly an endorsement

of the effectiveness of its water conservation.‘ " Mr. Gooch suggested that the

variation probably is due to the difference in whether a wet year or a dry year was

used as the starting point, but acknowledged that he didn’t see the basis for the

numbers in the plan.
' ‘2

Regardless of the basis for the starting point, both the plan and the record are

devoid of any explanation of the basis for the development of the goals.‘ '3 TCEQ is

"0 AR, Vol. 24, Item 377 (hearing transcript for Jan.
18, 2013) at p. 920, line 6 — p. 923, line 22.
In later testimony, as pan of the Applicants’ rebuttal case, Mr. Gooch noted that the starting
point for average per capita use per day is described in the 2012 plan as being based on Region C
Water Plan projections. However, he indicated that he did not know how it was actually
calculated and further conﬁrmed that he did not know how the indicated reduction in per capita
use—the goal—was calculated. AR, Vol. 25, Item 380 (hearing transcript for Jan. 23, 2013) at p.
1845, line 7 — p. 1847, line 25.
'” Id.
'53
AR, Vol. 24, Item 377 (hearing transcript for Jan. 18, 2013) at p. 921, line 7 — p. 923, line 9.
"3
TCEQ argues that NWF did not preserve this error in its Motion for Rehearing. TCEQ Brief
However, NWF’s
at p. 24. Motion for Rehearing, with respect to FOFs 332 and 334, sufficiently
put TCEQ on notice of its contention that the basis for determining the District’s goals were
reasonable was missing from the record.

58
required to follow its rules. Flores v. Employees Retirement System of Texas, 74

S.W.3d 532, 542 (Tex.App.—Austin 2002, pet. denied).

That is not just a minor detail. Other than a speciﬁc goal for percentage of

unaccounted for water, the measures in the District’s water conservation plan are not

quantiﬁed except through the per capita target goals. For example, there is no

quantiﬁcation of how much public education will be provided.‘ '4
Indeed, TCEQ’s

water conservation witness testiﬁed that, for example for a public education

campaign, the agency does not “have a mechanism in place to evaluate their program

as adequate or not, you know, from their water conservation plan.”"5 That

quantiﬁcation, and an explanation of its basis, is a speciﬁc requirement for any water

conservation plan, especially for one that purports to be adequate to result in the

highest practicable levels of water conservation and efﬁciency achievable.

Compliance with the rules is also a speciﬁc prerequisite to issuance of a permit.”

Even if the measures included in the District’s plan did include the full universe of

measures that might be needed to reach the highest practicable levels of water

"4 AR, Vol.
18, Item 239 (2012 WCP) at pp. 10-11.
"5 AR, Vol. 24, Item 380 (hearing transcript for
January 23, 2013) at p. 1649, line 5 — p. 1651,
line 17.
"6 30 TAC Section 295.9 provides that an application which doesn’t
meet the requirements for
water conservation plans set out in that section is incomplete and shall not be considered by the
commission. Paragraph (2) provides that applications for wholesale water providers, like the
District, must include a water conservation plan meeting the requirements of 30 TAC Chapter
288 of TCEQ’s rules. In addition, 30 TAC Section 297.18 (d)(2) also imposes that requirement
for applications involving interbasin transfers.

59
conservation and efficiency achievable, establishing a sufﬁcient amount or level of

effort associated with those measures is essential for a reasoned determination of

whether the statutory standard has been met. The record is devoid of any basis for

determining that the level of effort called for in the District’s water conservation

plan is sufficient to meet the statutory test.

Other than conclusory statements about compliance with Section 288.5, which

do not constitute probative evidence because they lack a reasoned basis, there is not

evidence to support those targets. Because Mr. Gooch was unable to provide any

basis for that opinion as it relates to the inclusion of the required basis for the

development of the ﬁve-year and the ten-year targets, it does not constitute probative

evidence on that point. See Jelinek, 328 S.W.2d at 536.

F. TCEQ’s errors prejudiced NWF’s substantial rights within the meaning of
Section 2001.174 (2) of the Government Code
The District argues that NWF has failed to demonstrate prejudice to its

substantial rights in accordance with Section 2001.174 (2) of the Texas Government

Code. Basically, the District appears to contend that NWF does not have a

substantial right to a decision made in accordance with governing statutes and

rules.‘ '7
There is limited precedent, but the cases addressing the issue, like the ones

"7 Although not construing Section 2001.174, in Texas Water Development Board v. Ward
Timber, 41 I S.W.2d 554, 568 (Tex.App.—Eastland, 2013) the court recognized the right of the
parties appealing the agency decision “to have the Board follow the statute and its own rule

60
cited by the District, indicate that the relevant test is one of determining if the error

complained of actually detrimentally affected the appealing party. For example, in

R.R. Comm '1: v. Rio Grande Valley Gas Co., 683 S.W.2d 783, 789 (Tex. App. Austin

1984), the court determined that the exclusion of evidence, even assuming the

exhibits should have been admitted, did not prejudice the appellee because the

evidence did not address the speciﬁc issue in dispute. What emerges from a review

of cases addressing this issue is a results-based approach, which looks at the extent

to which the alleged error likely affected the outcome of the agency decision to the

detriment of the appealing party. That is also consistent with Rule of Appellate

Procedure 44.1 (a),"8 establishing the standard for reversible error. If the error

complained of is likely to have affected the agency decision adversely to the

complaining party, then the test is satisfied.

The cases cited by the District illustrate that approach. In United Sav. Ass ‘n

of Tex. v. Vandygriﬂ, 594 S.W.2d 163 (Tex. Civ. App.—Austin 1980), the court

notes that the appealing party, who participated in the hearing to oppose the name

change of a competitor savings and loan, had not shown harm in claiming it was

error for the decision to delay for a year the effective date of the name change the

"8 TRAP 44.1, Reversible Error in Civil Cases, Standard for Reversible Error. Nojudgment
(21)

may be reversed on appeal on the ground that the trial court made an error of law unless the court
of appeals concludes that the error complained of:
(1) probably caused the rendition of an improper judgment; or
(2) probably prevented the appellant from properly presenting the case to the court of
appeals.

61
appealing party opposed. The court, in interpreting the question of prejudice of

substantial rights, determined that because, if anything, the appealing party

benef1ted"° from the delay, “[e]ven if the Commissioner exceeded his statutory

authority, we find no substantial rights of United Savings prejudiced by the

Commissioner’s delay of the effective date of the order.” Id. at 172.

In Lone Star R.V. Sales v. Motor Vehicle Bd. of Tex. Dep’t of Transp., 49

S.W.3d 492, 500 (Tex. App.—Austin 2001, no pet.), the court determined that the

appealing party was not prejudiced by the failure of the agency to grant it a

continuance when it had not actually asked for a continuance and had been provided

ample opportunity to make its arguments.”° Those two cases stand for the

unremarkable proposition that errors which beneﬁted the appealing party or did not

actually affect the outcome or otherwise cause ham to the appealing party’s

presentation of its case do not demonstrate prejudice to substantial rights. The other

case cited by the District, Texas Health Facilities Comm ’n v. Charter Medical-

Dallas, Inc., 665 S.W.2d 446, 452 (Tex. 1984), merely quotes the language of

Section 2001.174 (2) without interpreting or applying it.

"9 “If anything, United Savings should beneﬁt from postponement, which allows a longer period
in which to disassociate itself in the public mind from the name ‘Southwestern Savings.” United
Sav. Ass 'n afTex., 594 S.W.2d at 172.
'3” “Lone
Star does not point to a single argument that it was not permitted to fully make either
in its own exceptions or in argument to the Board. Finding that the purpose of the rules—to
ensure a fair, just, and effective adjudication of the parties’ rights—was served, and that no
prejudice to Lone Star's substantial rights occurred, we overrule its ﬁrst three issues." Lone Star
R. V. Sales, 49 S.W.3d at 500.

62
NWF, like any party to a contested case hearing, has the right to have a

decision rendered in compliance with applicable law. If, as the District Court found,

TCEQ failed to comply with Section 11.085 (l)(2) in making its decision, NWF’s
substantial rights were prejudiced by that failure and the agency’s decision must be

reversed. That also is true if, as NWF contends, the decision is not supported by

substantial evidence. This is not a situation where NWF is complaining about a

procedural or evidentiary ruling and a serious question exists about whether the

ruling actually affected the outcome or prejudiced NWF’s rights. As an affected

person and party to the hearing, NWF was entitled to a decision made in compliance
with applicable rules and statutes and TCEQ’s failure to follow controlling law

resulted in substantial harm to NWF. Each error complained of by NWF affected the

agency decision adversely to NWF in a substantial way.

63
PRAYER
TCEQ’s decision in this matter to grant the District‘s application is not

supported by substantial evidence, is arbitrary and capricious, an abuse of discretion,

and contrary to law. Accordingly, NWF respectfully requests that this Court affirm
the decision of the District Court or, if the District Court decision is not afﬁmied,

reverse the decision of TCEQ based on its failure to comply with the requirements

of 30 TAC Sections 288.5 (1)(B) and (1)(H).‘2‘

Respectfully Submitted,

/s/ Myron J. Hess
Myron J. Hess
State Bar No. 09549415
Annie E. Kellough
State Bar No. 24074517

NATIONAL WILDLIFE FEDERATION
44 East Ave., 200 Ste.
Austin, Texas 78701
Telephone: (512) 610 — 7754
Facsimile: (512) 476 —- 9810
hess@nwf.org
ke1lougha@nwf.org

COUNSEL FOR APPELLEE NATIONAL
WILDLIFE FEDERATION

'3'
The District Court did not reach those issues because it reversed the agency decision for a

failure to comply with the requirements of Section 1 1.085 (l)(2) of the Water Code.

64
CERTIFICATE OF COMPLIANCE

I certify that this Brief of the Appellee, National Wildlife Federation, complies with

the word-count limitations of Tex. R. App. P. 9.4(i)(2)(B), because it contains

12,835 words, excluding any parts exempted by Tex. R. App. P. 9.4(i)(1).

/s/ Myron J. Hess
MYRON HESS J.
CERTIFICATE OF SERVICE

By my signature below, I certify that on this 27th day of July 2015, a true and correct

copy of the foregoing Brief of Appellee was served upon the parties identiﬁed below

by electronic service.

/s/ Myron J. Hess

Myron J. Hess

Lambeth Townsend
Jason Hill
Elizabeth P. Hernandez
Lloyd, Gosselink, Rochelle & Townsend
816 Congress Ave., Ste. 1900
Austin, Texas 78701
ltownscnd@lglawﬁrm.com
ihill@l2luwl'irm.com
chernande/,@lglawlirmcom
Attorneys for Upper Trinity Regional Water District

Cynthia Woelk
Ofﬁce of the Attorney General
Environmental Protection Division (MC—O66)
P.O. Box 12548
Austin, Texas 78711-2548
Cvnlhia.Woe1k@toxasaltorncvgencralgov
Attorney for Texas Commission on Environmental Quality

66
TABLE OF APPENDICES

Appendix 1: Technical Review of Water Conservation Plan, Texas
Commission on Environmental Quality, February 15, 2011.

Appendix 2: Unofﬁcial transcript of portion of Agenda Item 1, Texas
Commission on Environmental Quality Commissioners
Meeting — September 24, 2013; full recording is available at
AR, Vol. 26, Item 383.
Appendix 3: S.B. 1094, 2003 Leg., 78(R) Sess. (Tx. 2003).

Appendix 4: H.B. 2660, 2003 Leg., 78(R) Sess. (Tx. 2003).

Appendix 5: Statutes

Tex. Gov’t Code Section 2001.172

Tex. Water Code Section 16.053 (a)

Appendix 6: 30 Tex. Admin Code Section 295.9
Appendix 1
Texas Commission on Environmental Quality
INTEROFFICE MEMORANDUM
To: Ronald Ellis, Project Manager Date: February 15, 2011
Water Rights Permitting Team
Water Supply Division

Thru: Christopher Loft, Team Leader
5 i ‘i "ResourceProtection Team
Water Supply Division

/65 Scott Swanson, Senior Water Conservation Specialist
0 \\\ Resource Protection Team
/(,\“) Water Supply Division

From: Kristin Wang, Senior Water Conservation Specialist

K V‘) Resource Protection Team
Water Supply Division
1/5’ I’
, Subject: Upper Trinity Regional Water District (UTRWD)
WRPERM5821
CN 60063 9272
Technical Review of Water Conservation Plan

Upper Trinity Regional Water District (UTRWD or applicant) seeks authorization to construct
and maintain a dam and reservoir (known as Lake Ralph Hall) with a maximum capacity of
180,000 acre-feet of water and a surface area of 8,500 acres on the North Sulphur River, Sulphur
River Basin, Fannin County, Texas for in-place recreation purposes and to divert and use not to
exceed 45,000 acre—feet of water per year from Lake Ralph Hall at a maximum diversion rate of
205 cfs (92,000 gpm) for municipal, industrial, and agricultural purposes. The application also
requests authorization to overdraft the reservoir as part of a system operation with existing
UTRWD supplies. Applicant requests to use the water in Collin, Cooke, Dallas, Denton, Fannin,
Grayson, and Wise Counties within the Sulphur River and Trinity River Basins and requests an
interbasin transfer (IBT) of water from the Sulphur River Basin to the Trinity River Basin.

The applicant required to provide evidence that the amount of water appropriated will be
is

beneﬁcially used, i.e., effectively managed and not wasted pursuant to Texas Water Code
(TWC), Section 11.134(b)(3)(A). Also, the applicant must provide evidence that reasonable
diligence will be used to avoid waste and achieve water conservation pursuant to TWC
:“""T1T1374(b‘)(‘¢)."l‘o’provi‘cl‘e' that evi‘dence,‘the‘applieantmtsrsubmirawvaterconservationrplanrin-——-—
accordance with Title 30, Texas Administrative Code (TAC), Chapter 288. In applications where
a new appropriation of water is requested, the technical review includes an analysis of whether
the requested appropriation is reasonable and _necessary for the proposed uses in accordance with
TWC 11.134 and 30 TAC 297.50. In applications where an IBT is requested, the technical
I

6r0wV‘- Eii" 5
TAC
we
review considers water conservation efforts in accordarice"vvith the requirements of 30
297.13 and 11,085.. .

The purpose of this technical review is to:

(1) determine whether reasonable water conservation goals have been set;
(2) determine whether the proposed strategies can achieve the stated goals; _
.

(3) determine whether there is a substantiated need for the water and whether the amount to be
appropriated is reasonable for the proposed use;
'

(4) determine whether the application meets the requirements of 'l."WC_ 1l.085(k) and (1) for
lBTs; and
’

I"
-

(5) determine whether the water conservation plan addresses a water supply needjn a manner
that is consistent with the state water plan and the relevant approved regional water plan

If these criteria are met, tlieii‘ considers this _suf_ﬁcier_1t tohéonclude that the
applicant will avoid waste and achieve water conservation. This teélinrcal ieiiiew forms a basis
for permit conditions and limitations as provided by TWC 11.134 and 1l.08'$.

U'I'RWD’s water right application was received on September 2, 20-03. submitted a-
2002 water conservation plan, additional information in 2004, and an amended plan in 2005. In
2009, UTRWD submitted an updated water conservation and drought contingency plan.
WATER CON§ERVATION GOALS & S'I'RA’I'BGlE§
_UTRWD’s plans were ﬁrst reviewed in accordance with 30 TAC 288. As a wholesale water
I
_
.

supplier, UTRWD does control the operation of its water supply, treatment, and transmission
system and can take direct action to the efficiency otﬂre system. UTRW'D_’s
average unaccounted for water has been approximately three percent (3%) and
rneastnes all raw water diversions using meters with an accuracy of plus or minus two percent
(2%).

The following goals and strategies have been outlined by UTRWD
'
'
for water conservation and
include:

1. F ive-year and10-year conservation goals of 175 gallons per capita per day (gpcd).
2. Maintain unaccounted-_for water in the system below ten percent (10%) annually.
3. Meter and record water deliveries and sales with a minimum accuracy of plus or minus
two percent (2%).
'

4. Maintain programs for leak detection and repair, and water loss accounting.
5. Raise public awareness of water conservation and encourage responsible public behavior
(Public Education Program).
'

6. Reuse and recycling of reclaimed wastewater.

Staﬁ‘ determined that the overall water conservation strategies provided in the UTRWD’s water
conservation plan are reasonable and can achieve the stated goals.

2
WATER NEED
Based on the 2009 water conservation plan, UTRWD currently provides wholesale treated water
service to nineteen members and customers (serving more than twenty-ﬁve communities) in
Denton and Collin Counties. U'I'RWD’s planning area includes the communities currently served
plus additional portions of Grayson, Wise, and Cook Counties.

UTRWD purchases raw water from the City of Dallas and City of Denton out of Lewisville Lake
and Ray Roberts Lake. Further, UTRWD has a contract for raw water ﬁom Lake Chapman in the
Sulphur River Basin and a permit to reuse water transferred from Lake Chapman to the Trinity
River Basin.

According to the 2006 Region C Water Plan, UTRWD currently supplies treated water to users
in Denton County, and a small amount to users in Collin County. UTRWD also provides direct
reuse for irrigation in Denton County. The total existing supplies can provide between 25,200
and 42,200 acre-feet per year from 2010 to 2060.

Considering losses associated with treatment and distribution, UTRWD needs to develop an
additional 7,000 acre-feet per year of raw water supplies by 2010 to meet projected demands and
an additional 122,000 acre-feet per year by 2060. UTRWD will also need to develop additional
treatment and distribution capacity to serve the growing demands of its current and future
customers.

The recommended water management strategies listed in Region C Water Plan for UTRWD
include the following:
-

Conservation
Additional supplies from Dallas Water Utilities (DWU) under current contract
'

Lake Chapman indirect reuse
Additional supplies fromDWU linked to lake Chapman reuse
Lake Ralph Hall
Indirect reuse of return ﬂows from Lake Ralph Hall
Marvin Nichols Reservoir
AdditionalDWU supplies
Oklahoma water
Water treatment plant and distribution system improvements

In
Table 1
'

Recommended Wate r Management Strategies for
Upper Trinity Regional Water District
.

(acre-feet per year)

Source 2010 2020 2030 2040
'
'

2050 2060_
Current Supplies .

Lake Chapman 14,068 13,335 13,602 13,369 13,136 12,905
DWU .

10,317 11,041 14,453 19,367 .
23,134 27,463
Direct Reuse ,
397 397 397 397 397 397
"-
Total Existing 25,232 25,773 23,957 34,133
-

42,217
-

41,265
-

, _

Water Management Strategies "
' i
'
' '

Conservation; . 350 3,070 _ 4,93_3 7,196 9,643 ,
-11,762
Additional Supplies from
DWU (Under Current
,.
_
__
. _- ..
_
__ _

1,000 1,000 1,000 1,000 23,295 27,336
Contract)‘ , _
-

,
.

Lake Chapman Indirect
3,441 3,301 8,161 3,021 7,332 7,743
Reuse
I

Additional DWU 5,627 5,534 5,441 5,343 5,254 5,162
.

Supplies (Reuse) _

Lake Ralph Hall 29,600 29,600 29,600 29,600 29,600
Additional Indirect Reuse 17,760 17,760 17,760 17,760 17,760
Marvin Nichols Reservoir
'

17,500 35,000 35,000 35,000
Additional DWU
Supplies '2’2-O0 6’o00
Oklahoma Water 15,000
T"“’l S“PP“°‘ °f
'

15 ’ 913 65 ’ 265 34,395 103 925 130 634 155 ’ 413
Strategies ’ ' ’

Tm‘ SIIPPIIES 41,200 91,039 113,351 133,053 172,351 196,673
P°“‘°” “DWU S“PP13’ 5,627 5,534 5,441 5,343 12,690 15,266
from Reuse
Total from Conservation
& Rem 15,315 35,562 37,192 39,222 43,372 53,423

& Reuse 33.4% 39.1% 32.3% 23.4% 233% 27.2%
Project Demands 31,769 56,353 30,904 109,456 136,932 155,331
13°55“ i.“ .T’°“‘““*”‘ and
1,533 2,313 4,045 '5,473 6,347 7,792
l'ﬂ.|2lS!.'n1SS10l1

Surplus 7,343 31,363 23,402 23,123 29,072 33,055
*saurce: 2006 Region C Water Plan (Volume 1, Table 4E.14. pages 413.40-4E.41)
4
Table 1 shows the recommended water management strategies for UTRWD’s water supply
development. Conservation savings from UTRWD’s existing and potential customers is
projected to reach 11,762 acre-feet per year by 2060. As shown in Table 1 above, 29,600 acre-
feet per year of the yield from Lake Ralph Hall (32,940 acre-feet) has been listed as a
recommended supply strategy to help UTRWD meet projected water demands for the next 50-
year planning period.

ALTERNATIVE WATER MANAGEMENT STRATEGIES
The 2006 Region C Water Plan also indicates that if any of the projects identiﬁed in the
recommended plan are not implemented, UTRWD may wish to pursue alternative strategies. The
following alternative water management strategies are recommended for UTRWD:

Toledo Bend Reservoir
Wright Patrnan Lake
George Parkhouse Reservoir (North)
George Parkhouse Reservoir (South)
Lake Texoma
Additional reuse

INTEEASIN TRANSFER CONSIDERATIONS
Review of the [BT request is based on the projected water needs for the basinof origin and
receiving basin for the 50-year planning period. The Sulphur River Basin is the basin of origin
and the Trinity River Basin is the receiving basin for the proposed Lake Ralph Hall Project. A
comparison of the total available supplies to projected demands for the Sulphur and Trinity River
Basins is shown in Table 2, which is based on the information provided in the 2006 Region C
Water Plan. From the table, the Sulphur River Basin shows a surplus of water, while the Trinity
River Basin is projected to have shortages during the 50-year planning period.

Table 2
Difference in Total Available Water Supply and Total Water Demand by Basin
Shown as Surplus or (Shortage)
( acre-feet per year)
-

River Basin 2010 2020 2030 2040 2050 2060

Sulphur 222,104 209,476 198,260 187,562 177,332 161,760
Trinity 1,065,986 722,172 451,588 177,387 (145,550) (535,830)
‘source: 2006 Region C Water Plan (Volume I, Table 4C.5, page 4C.19) .

Projected shortages in the Trinity River Basin will reach 145,550 and 535,830 acre-feet per year
in 2050 and 2060, respectively. The plan indicates that the IBT request from this project can help
meet the water demands for Trinity River Basin during the 50-year planning period and meet the
overall water demands for the region .
The economic impacts‘ "of -new reservoirs (including Lake Ralph Ha1l)_ were discussed and
considered in the'2006 Region C Water Plan (Volume 1). The plan indicates that new reservoirs
can stimulate the rural economy through new recreational business and local improvement. The
2006 Region C Water Plan also includes a preliminary analysis of the impacts of not meeting the
projected water demands. The analysis indicates that a_ severe drought occurring in a single year
would reduce the projected 2060 po'pula'tion, employment, and income trends. Further, the plan
indicates if no additional Viiater supplies are developed, Region C will face substantial shortages
in water supply over the next several decades. This information is presented in Appendix Q of
the Region C Water Plan. For municipal uses, the ecoiiomic impacts by counties (for example
Fannin and Denton), and distribution of regional impact among major river basins (Sulphur and
were considered.
'

Trinity)

Based on the 2006 Region C Water Plan, UTRWD' plans to" provide 10% of the yield from Lake
Ralph Hall for use in southern Fannin County. The Gity of. Ladonia uses the Trinity Aquifer as
their current water supply. According to the 2006 Region C Water Plan, Ladonia will have water
shortages throughout the 50-year planning period. The recommended water management
strategies to meet their needs include water conservation, overdraﬂ of the Trinity Aquifer with
new wells, and purchase of water from UTRWD (Lake Ralph Hall). The City of Ladonia’s
projected population, total projected water demand, current supply, and water management
strategies are summarized in Table 3.

Table 3
Water Planning Summary for City of Ladonia
_

(acre-feet per. year)

2010 2020 2030 2040 2050 2060
Projected Population l‘,-500 1,600 2,000 2,200 2,500 3,000
'

Projected Municipal Water‘ Demand '

545 577 715 779 , 379 1,055
Current Available Water Supplies
276 _

276 276 276 276 276
(Trinity Aquifer)
Water Management Strategies
Water Conservation — Basic Strategies 16 27 40 50 64 85
Water Conservation - Expanded
0 2 5 6 6 8
Strategies .

Ralph Hall Reservoir 0 558 709 754 914 1,140
'

Overdraﬁ Trinity Aquifer (New Wells) 254 '

0 0 0 0 0
Total Water Management Strategies 270 587 754 810 984 1,233
V

Total Supply Less Projected Demand 0 '
"286 315 307 381 434
‘source: 2006 Region C Water Plan (Volume II’, Appendix" V. Table V-1, page 64 ofI12)

With the Trinity Aquifer as the only current water supply, Ladonia will have a maximum need of
779 acre-feet per year during the 50-year planning period. The City’s water needs can be
6
supplemented by the Lake Ralph Hall project, which can provide Ladonia with 558 to 1,140
ﬁom 2020 to 2060. Therefore, the Lake Ralph Hall project will
acre-feet of water per year
by providing additional water supply to City of Ladonia.
beneﬁt the Sulphur River Basin

As previously shown in Table 2, the Trinity River Basin will have water shortages during the 50-
year planning period. Many water user groups in Denton County receive water supplies from
UTRWD. Table .4 summarizes population projections, water demand projections, currently
available supplies,and water needs for Denton County. Demon County will have projected water
needs of 24,753, 113,311, and 256,411 acre-feet per year in 2010, 2030, and 2060, respectively.

. Table4
Population and Water Planning Summary
for Denton County
(water quantiﬁes in acre-feet per year)

2010 2020 2030 2040 2050 2060
£°P.“‘“?‘°“ 720,064 953,668 1,184,744_ 1,392,575 1,610,447 1,870,472
rojecnons
:Va?°”.3e“‘““d 212,211 263,594
162,003 307,951 353,300 406,700
rojectrons
_

g1‘:;;°1‘i‘;lS’A”“1“b1° 137,250 142,695 150,233 153,531 155,652 150,289
WaterNeed 24,753 69,516 113,311 154,420 198,148 256,411
‘source: 2006 Region C Water Plan (Volume 1, Tables 2.1, 2.2. 3. 7 & 4.4.2, page: 2.8, 2.19, 3.13& 4A.5)

UTRWD is a signiﬁcant water supplier in this area in conjunction with other region water
providers such as Dallas Water Utilities, City of Denton, North Texas Municipal Water District
(NTMWD), and Tarrant Regional Water District (TRWD). In the 2006 Region C Water Plan, 26
Denton County water user groups list “additional UTRWD
watef’ as one of the recommended
water management strategies to meet their water demand projections.

Many UTRWD members use groundwater for a porﬁon of their water supply. In Denton County,
groundwater resources are very limited, and current groundwater use from the Trinity and
Woodbine aquifers exceeds the estimated reliable long—tenn supply based on groundwater
availability (2006 Region C Water Plan). Therefore, water suppliers in Denton County need to
increase their use of surface water supplies. Based on U'I'RWD’s 2009 water conservation plan,
one of the key purposes of the regional Surface Water Supply and Wastewater Treatment
Program is to avoid further draw-down of limited ground water resources, and to make surface
water available for ﬁttther growth.

_C'Waﬁ‘PlEnI’U'I'RWD’1REﬁ'ds"tTuﬁnsport'90Vi6f”tlie‘L3]?
./3;cc?317din_g_to_?l1_e“2‘0_0_6'Ke7g‘ioE

Ralph Denton
Hall yield to County. Thus, the project will beneﬁt the receiving Trinity River
Basin by providing water to Denton County mainly for municipal purposes. In addition, the IBT
water can be used for Collin, Cooke, Dallas, Denton, Grayson, and Wise Counties within the
Trinity River Basin for municipal, industrial, and agricultural purposes.
7
UTRWD submitted an economic analysis, “The Economic Impact of Lake Ralph Hall“ with the
water right application. states that construction of Lake- Ralph Hall will bring
recreational and other beneﬁts to the Sulphur River Basin. The report details the costs and
beneﬁts to Fannin County (in the basin of origin), and Denton County (in the receiving basin}
from the construction of Lake Ralph Hall. The report shows that the beneﬁts of the proposed IBT
outweigh the costs to both the area'in and around Fannin Cormty and the area in and around
A
Denton County. net present worth analysis of these costs and beneﬁts was performed for the
period from 2004 through 2036. Based on the analysis, the net present worth of beneﬁts to basin
of origin is $147 million and the net present worth of beneﬁts to receiving basin is $18 billion.

The 2006 Region C Water Plan identiﬁed a set of waterconservaﬁon strategies that will result in
the highest practicable level of conservation and efﬁciency achievable as required for lBTs under
TWC 11.085. The Region C Plan’s recommended water conservation strategies include a basic
package that includes lo_w-ﬂow plumbing-ﬁxture rules, public and school education, waterlluse
reduction due to increasing water prices, water system audit, leak detection and repair, pressure
control, and Federal residential clothes washer standards. Reuse of treated wasfewater efﬂuent
has been identiﬁed as one of the strategies for an expanded water conservation package.
UTRWD has included the identiﬁed water conservation strategies in its water conservation plan
and included a model water conservation plan for its members and customers. In order to comply
with TCEQ conservation rule requirements, UTRWD is required to submit a water conservation
implementation report every ﬁve years. The implementation report must include: (a) the. list of
dates and descriptions of the conservation measures implemented; (b) data about whether or not
targets in the plans are being met; (c) the actual amount of water saved; and (d) if the targets are
not being met, an explanation as to why any of the targets are not being met, including any
progress on that particular target. '
-

As a wholesale public water supplier, UTRWD 'will develop and"-implement wholesale water
contracts that include applicable water conservation and drought contingency requirements. In
addition, one of the _slIaté'gies identiﬁed‘ by the Water Conserveition Task Force Best
'

Management Practices ('l3MP) Guide Report 362), Wholesale Agency Assistance
Programs BMP (BMP 2.14), is exclusively applicable to wholesale water suppliers. UTRWD has
included elements of the wholesale BMP in its conservation plan. If UTRWD
implements all
elements of its water conservaﬁon plan, then staff believes that the highest practicable level of
conservation for UTRWD can be achieved. By preparing a drought contingency plan and
preparing and implementing a water conservation plan that will result in the highest practicable
levels of water conservation and eﬁciency within its jurisdiction, and if UTRWD ensures
through contracts that its customers develop water conservation plans that implement the
recommended strategies listed in the approved Regional Water Plan, the application can meet the
requirements of TWC 1I.085(l)(2).

CONSISTENCY WITH STATE AND REGIONAL WATER PLANS
The Lake Ralph Hall Project is listed as one of the recommended water management strategies in
the Region C Water Plan and the current State Water Plan and is one of the major water
conveyances proposed by the planning group. This application is consistent with 2006 Region C
8
Water Plan and 2007 State Water Plan.

SUMMARY
The application has been evaluated and determined to meet technical review requirements in
TCEQ rules and applicable statutes. Staﬂ‘ determined that the listed conservation goals and
strategies in UTRWD’s water conservation plan can achieve the highest practicable levels of
water conservation and emciency in UTRWD’s service area

The application is consistent with the approved January 2006 Region C Water Plan and the 2007
State Water Plan because the Lake Ralph Hall project is listed as one of the recommended water
management strategies for UTRWD in both plans.

RECOMMENDATIONS
Staff recommends that, if the application is granted, the following water conservation language
should be included in the permit: _

Permittee shall implement water conservation plans that provide for the utilization of those
practices, techniques, and technologies that reduce or maintain the consumption of water,-
prevent or reduce the loss or waste of water, maintain or improve the efﬁciency in the use of
water, increase the recycling and reuse of water, or prevent the pollution of water, so that a water
supply is made available for future or alternative uses. Such plans shall include a requirement
that in every wholesale water contract entered into, on or after the effective date of this permit,
including any contract extension or renewal, each successive wholesale customer develop and
implement conservation measures that can result in the highest practicable levels of water
conservation and eﬁciency in order to comply with 'I'WC 11.085 (1)(2). If Permittee authorizes
the resale of water by a customer, then the contract for resale must have water conservation
requirements so that each successive wholesale customer in the resale of the water will be
required to implement water conservation measures.
Appendix 2
Unofﬁcial Transcript
Texas Commission on Environmental Quality
Commission Meeting
September 24, 2013

TCEQ Docket No. 2012-0065-WR; SOAI-I Docket No. XXX-XX-XXXX. Consideration of
the Administrative Law J udges' Proposal for Decision and Order regarding the application of
Upper Trinity Regional Water District for Water Use Permit No. 5821 to construct and maintain
a dam and reservoir (Lake Ralph Hall), on the North Sulphur River, Sulphur River Basin, in
Fannin County for in-place recreational purposes and to divert and use not to exceed 45,000
acre-feet per year from the perimeter of the proposed reservoir for municipal, industrial, and
agricultural purposes. The Applicant requests an authorization to transfer water from the
Sulphur River Basin to the Trinity River Basin, for use in portions of Collin, Cooke, Dallas,
Denton, Fannin, Grayson and Wise Counties. The Commission will also consider timely public
comments, timely related ﬁlings, exceptions and replies. (James Aldredge, Ron Ellis)

Commissioner Dr. Bryan Shaw: Thank you. Any questions at this time? Thank you. If you have
questions of ED if you want to go ahead and jump in there it'd be great.
MI-I

Commissioner Toby Baker: Well I’d just love to hear your thoughts about what Mr Hess
presented, I, I'm, uh, based on the record and what I read in the PF D I don’t know if I agree with
them and I'm wondering if you could just speak a little bit more about the water conservation
0\U‘l-I393

plan and how you ended up where you are.
James Aldredge: Certainly, certainly. The legislature in 2003 I believe it was directed the
\Dm\l Commission and the Water Development Board to jointly develop — and this is codiﬁed in the
water code, and I’m going to paraphrase, I don’t have it right in front of me but it was to develop
best management practices, designed for the highest practicable level of water conservation and
efﬁciency achievable within the jurisdiction of an individual water supplier. A couple of years
after that, the Water Development Board, after a review process by the Water Conservation Task
Force, published Report 362, which is titled Best Management Practices Guide for Water
Conservation. Upper Trinity Regional Water District's conservation plan incorporates, not every
best management practice, but a signiﬁcant amount of them, and at least components of each of
the individual best management practices that are published there; and the argument that
National Wildlife Federation has made, and they had witness testimony to this effect at hearing,
is that that guide is not intended to be the guide for best management practices for the highest
practicable level of water conservation and efﬁciency achievable. The ED takes exception to that,
if that guide isn’t that, then one doesn’t exist. It is the only statement, by either this
Commission, or the Water Development Board, that directs any form of best management
practice for water conservation. In that light, we believe, after our review of their water
conservation plans, there have been repeated iterations of them, that they have consistently met
what is required of them under Section 11.085 of the Water Code, the inter-basin transfer
section, which, that's the standard: highest practicable level of water conservation and efﬁciency
achievable. Further than that, we have to remember that Upper Trinity Regional Water District
is a wholesale water provider. They don't make contracts with the end users of water. They have
a limited scope of customers, all of their customers are retail water providers. The standards
that they have to meet under Section 288.5 of our rules, which is the rule for wholesale water
providers, they've met it; there is nothing in there about building into their supply contracts
requirements that the retail water supplier customers then have to turn around and meet some
particular level of efﬁciency. There are rules precisely for what retail water suppliers must do in
33 their individual water conservation plans, and the Executive Director reviews those, and they
34 are subject to Executive Director approval. So we're conﬁdent that the highest level of water
35 conservation and efﬁciency achievable within U'I'RWD’s jurisdiction will happen as a result of
the plan that they’ve developed. And we’re pretty conﬁdent in that and we would recommend
37 that you, that you ﬁnd the same and in doing so issue the permit.

38 Commissioner Toby Baker: Thank you for that and that’s sort of howl understood it and I
39 wanted to just make sure that I was understanding it correctly, that the issue that they’re
4o presenting is sort of that they’re saying that Report 362 isn’t the standard, and I agree that there
41 is no standard if we don’t go there. So thank you for that, it was enlightening, thanks.
Appendix 3
S.B. No. 1094

AN ACT
relating to the creation of a task force to evaluate matters
regarding water conservation.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

O\.DCl7~lO’|UI-b|dI\)§-‘
SECTION 1. DEFINITION. In this Act, "task force" means the
water conservation implementation task force created under Section
2 of this Act.
SECTION 2. WATER CONSERVATION IMPLEMENTATION TASK FORCE.
(a) The Texas Water Development Board shall select members of the
I-‘
water conservation implementation task force to represent the
D-‘ I-‘
following entities and interest groups from applicants recommended
I-‘
M by the following entities and interest groups:
H (.1
(1) Texas Commission on Environmental Quality;
H 1) (2) Department of Agriculture;
H ul (3) Parks and Wildlife Department;
H G‘ (4) State Soil and Water Conservation Board;
H ~l (5) Texas Water Development Board;
I-' C!)
(6) regional water planning groups;
I-‘
LD (7) federal agencies;
NO (8) municipalities;
N I-4
(9) groundwater conservation districts;
N NI (10) river authorities;
Nu (11) environmental groups;
Nh (12) irrigation districts;
S.B. No. 1094
(13) industries;
(14) institutional water users;
(15) professional organizations focused on water
conservation; and
(16) higher education.
°\Dm\IU\Ulcb|aJ|\l|-'

(b) The executive administrator of the Texas water
Development Board or the administrator's designee is the presiding
officer of the task force.
SECTION 3. DUTIES OF TASK FORCE. The task force shall
H review, evaluate, and recommend optimum levels of water use
I-‘ D-'
efficiency and conservation for the state by:
I-‘
M (1) identifying, evaluating, and selecting best
H In management practices for municipal, industrial, and agricultural
Hb water uses and evaluating the costs and benefits for the selected
I-
|J'I
best management practices:
I—' OI
(2) evaluating the implementation of water
I-' ‘I
conservation strategies recommended in regional and state water
D-‘ an plans;
I- \.D (3) considering the need to establish and maintain a
NO statewide public awareness program for water conservation:
Iu I- (4) evaluating the proper role, if any, for state
NM funding of incentive programs that may facilitate the
|\)
u implementation of best management practices and water conservation
M uh strategies;
M U! (5) advising the Texas Water Development Board and the
M 0! Texas Commission on Environmental Quality on:
I0 ~l
(A) a standardized methodology for reporting and
S.B. No. 1094
using per capita water use data;
(E) establishing per capita water use targets and
goals, accounting for such local effects as climate and
demographics; and
’a\Dm~lU\U'|-‘>1-INI-‘ (C) other possible uses as appropriate; and
(6) evaluating the appropriate state oversight and
support of any conservation initiatives adopted by the legislature.
SECTION 4. ASSISTANCE OF STATE AGENCIES. The task force may
request the assistance of state agencies, departments, or offices
'to carry out its duties, including necessary staff support.
5-‘
H SECTION 5. PUBLIC MEETINGS. The task force may hold public
I-'
N meetings as needed to fulfill its duties under this Act.
H La!
SECTION 6. BEST MANAGEMENT PRACTICES GUIDE; REPORT. Not
5-‘
A later than November 1, 2004, the task force shall develop a best
9-‘ U‘
management practices guide for use by regional water planning
|-' GI groups and political subdivisions responsible for water delivery
H ~l
service and shall make a final report to the lieutenant governor,
I-'
In the speaker of the house of representatives, and the legislature
H \D evaluating the issues described in Section 3 of this Act.
NO SECTION 7. EXPIRATION OF ACT AND AEOLITION OP TASK FORCE.
MH This Act expires and the task force is abolished on January 1, 2005.
NM SECTION B. EFFECTIVE DATE. This Act takes effect
M to immediately if it receives a vote of two-thirds of all the members
M J) elected to each house, as provided by Section 39, Article III, Texas
Iu ul Constitution. If this Act does not receive the vote necessary for
M 5" immediate effect, this Act takes effect September 1, 2003.
S.B. No. 1094

President of the Senate Speaker of the House
I hereby certify that 5.3. No. 1094 passed the Senate on
April 22, 2003, by the following vote: Yeas 31, Nays 0.

Secretary of the Senate
I hereby certify that S.B. No. 1094 passed the House on
May 6, 2003, by the following vote: Yeas 143, Nays 0, two present
not voting.

Chief Clerk of the House

Approved:

Dat E

Governor
Appendix 4
11.13. N6. 2660

AN ACT
relating to the establishment of minimum levels of water
conservation in water conservation plans.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION Section 11.1271, Water amended by
O\0m\lU\U|ﬁlJf\-I}-'

1. Code, is
amending Subsection (c) and adding Subsections (d), (e), and (f) to
read as follows:
(c) Beginning May 1, 2005, all water conservation plans
ﬂuired under this section must include specific, quantified
I-‘
S-year and 10-year targets for water savings. The entity preparing
I-' I-‘
the plan shall establish the targets. Targets must include goals
D-‘
N for water loss programs and goals for municipal use in gallons per
|-' (Al
cagita per day.
5-‘ .I>
(d) The commission and the board jointly shall identify
|-' U!
Eantified target goals for water conservation that water suppliers
I-‘ 0" and other entities may use as guidelines in preparing water
I-‘ \I
conservation plans. Goals established under this subsection are
0-‘
In not enforceable reguirements.
I-‘
W (e) The commission and board jointly shall develop model
MO water conservation programs for different types of water suppliers
N I-‘
that suggest best management practices for achieving the highest
MM practicable levels of water conservation and efficiency achievable
Nw for each specific type of water supplier.
MD (f) The commission shall adopt rules establishing criteria
H.B. Na. 2660
and deadlines for submission of water conservation plans, including
any required amendments, and for submission of implementation
reports.
SECTION 2 . Section 15.106, Water Code, is amended by adding
Subsection (17-1) to read as follows:
S\Dﬂ1\Id\U|ahhlI\-ll-'

(b-1) Beginning May 1, 2005, all water conservation plans
required under this section must include specific, quantified
5-year and 10-year targets for water savings. The entity preparing
the plan shall establish the targets. Targets must include goals
for water loss programs and goals for municipal use in gallons per
ll capita per day.
12 SECTION Section 17.125, Water Code, is amended by adding
3.

13 Subsection (b-1) to read as follows:
14 (h-1) Beginning May 1, 2005, all water conservation plans
15 required under this section must include specific, quantified
16 5-year and 10-year targets for water savings. The entity preparing
17 the plan shall establish the targets. Targets must include goals
18 for water loss programs and goals for municipal use in gallons per
19 capita per day.
20 SECTION 4. Section 17.277, water Code, is amended by adding
21 Subsection (b-1) to read as follows:
22 (b-1) Beginning May 1, 2005, all water conservation plans
23 required under this section must include specific, quantified
24 5-year and 10-year targets for water savings. The entity preparing
25 the plan shall establish the targets. Targets must include goals
26 for water loss programs and goals for municipal use in gallons per
27 capita per day.
H.B. No. 2660
SECTION 5. Section 17.857, Water Code, is amended by adding
Subsection (b—1) to read as follows:
(17-1) Beginning May 1, 2005, all water conservation plans
required under this section must include specific, quantified
s\.DlD~lO\ll|-bl:-Il\-ll-'

5-year and 10-year targets for water savings. The entity preparing
the plan shall establish the targets. Targets must include goals
for water loss programs and goals for municipal use in gallons per
capita per day.
SECTION 6. Not later than September 1, 2004, the Texas
Commission on Environmental Quality and the Texas Water Development
1-‘ I-‘
Board shall take the actions necessary to comply with Section
I-‘
IU 11.1271, water Code, as amended by this Act.
|-'
In SECTION 7. (a) This Act takes effect immediately if it
I-'
ah receives a vote of two-thirds of all the members elected to each
I-‘
U'|
house, as provided by Section 39, Article III, Texas Constitution.
I-‘ O‘ If this Act does not receive the vote necessary for immediate
H xl
effect, this Act takes effect September 1, 2003.
I4 U)
(b) The change in law made by this Act to Section 11.1271,
I-'
0 Water Code, applies to a holder of an existing permit, certified
MO filing, or certificate of adjudication as described in Section
M I-4
11.1271(b) , Water Code, regardless of whether the permit, certified
MM filing, or certificate of adjudication is obtained before, on, or
N La after that date.
MD (c) The changes in law made by this Act to Sections 15.106,
N Ul 17.125, 17.277, and 17.357, water Code, apply only to applications
M U‘ for financial assistance filed with the Texas Water Development
N «I
Board on or after the effective date of this Act.
H.B. Na. 2660

President of the Senate Speaker of the House

I certify that H.B. No. 2660 was passed by the House on May 2,
2003, by the following vote: Yeas 126, Nays 0, 2 present, not
voting.

Chief Clerk of the House

I certify that H.B. No. 2660 was passed by the Senate on May
28, 2003, by the following vote: Yeas 31, Nays 0.

Secxetaxy of the Senate

APPROVED:
Date

Governor
Appendix 5
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