HB5320

Regular Session

Relating to the powers, duties, and governance of the Starr County Drainage District, the change of the name of the Starr County Drainage District to the Starr County Drainage and Groundwater Conservation District, the dissolution of the Starr County Groundwater Conservation District, and the transfer of the assets and liabilities of the Starr County Groundwater Conservation District to the Starr County Drainage and Groundwater Conservation District; authorizing the imposition of a tax.

ModeratePlan for compliance

Medium Cost

Effective:2025-09-01

Enforcing Agencies

Starr County Drainage and Groundwater Conservation District • Starr County Commissioners Court • Texas Commission on Environmental Quality (TCEQ)

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

Effective Date: September 1, 2025.
Compliance Deadline: September 1, 2025 (for vendor/payee updates); January 31, 2026 (anticipated deadline for first tax payments under new authority).
Agency Rulemaking: The new Board will be appointed shortly after September 1, 2025. Expect a "regulatory gray zone" in Q4 2025 and Q1 2026 while the new Board harmonizes existing groundwater rules with drainage protocols. Current rules remain in effect until formally amended.

Immediate Action Plan

1. Update Financial Systems: Change the vendor name in AP systems effective 9/1/2025 to prevent payment delays.
2. Lobby for Board Appointment: Submit qualified candidates for the "Industrial Interest" Board seat to the Starr County Commissioners Court before August 2025.
3. Review Tax Liability: Re-calculate property tax projections for Starr County holdings based on potential new Chapter 49 assessments.
4. Audit Compliance Protocols: Review internal environmental compliance manuals; ensure they prioritize District groundwater rules over conflicting municipal ordinances.

Operational Changes Required

Contracts

Automatic Assumption: Existing contracts with the dissolved Groundwater District legally transfer to the new Combined District. You do not need to execute new agreements.
Notice of Acknowledgment: Legal departments should issue a formal "Notice of Acknowledgment" to the new District confirming recognition of the transfer to prevent service interruptions or payment disputes.
Municipal Agreements: If your business relies on municipal water, monitor for new inter-local agreements, as the District is now authorized to assume municipal utility functions.

Hiring/Training

Government Relations: Assign a representative to engage the Starr County Commissioners Court immediately. The Court appoints the new five-member Board.
Board Representation: If you are an industrial operator, you must advocate for a favorable appointee to the specific Board seat reserved for "active industrial interests" (Sec. 11022.0201(4)).

Reporting & Record-Keeping

Vendor Management: Update vendor master files immediately. Payments made to "Starr County Groundwater Conservation District" after September 1 may be rejected. Redirect all payments to "Starr County Drainage and Groundwater Conservation District."
Permit Audits: Audit all active groundwater well permits. While valid, the issuing authority has changed. Ensure renewal applications reference the new District name to avoid administrative rejection.

Fees & Costs

Tax Accruals: The new District has authority to impose ad valorem property taxes. Finance teams must adjust tax accruals for the 2026 tax year to account for potential rate increases or new assessments.
Utility Exemptions: Electric, gas, telecom, and cable utilities are statutorily exempt from impact fees, standby fees, or assessments on equipment/rights-of-way. Accounts Payable must flag and contest any invoices attempting to apply these fees.

Strategic Ambiguities & Considerations

"Active Industrial Interests": The statute reserves one Board seat for this group but fails to define the selection criteria. Without immediate industry input, the Commissioners Court may appoint a director who does not align with your operational needs.
Regulatory Supremacy: The law states the District’s groundwater rules prevail over conflicting municipal or regional water authority rules. It does not specify a dispute resolution mechanism. If your facility is caught between a City ordinance and a District rule, the District rule controls, but enforcement during the transition may be inconsistent.

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Legislative Timeline

This bill's path through the Texas Legislature

TopicsStarr County Drainage and Groundwater Conservation District County Government County Government--general Environment Environment--water Special Districts & Authorities Special Districts & Authorities--groundwater Conserve Dist.Water Water--conservation Starr County Starr County Drainage District Starr County Groundwater Conservation District

Official Analysis

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BILL ANALYSIS

C.S.H.B. 5320

By: Guillen

Natural Resources

Committee Report (Substituted)

BACKGROUND AND PURPOSE

The bill author has informed the committee that Starr County has separate governance structures for groundwater conservation and drainage which can lead to fragmented policies, duplicative services, and inefficient use of resources, and that such separation may hinder coordinated water planning and infrastructure development. C.S.H.B. 5320, in order to enhance administrative efficiency and provide a unified approach to managing water infrastructure and resources, seeks to consolidate the functions of drainage and groundwater management into a single district for the county by providing for the Starr County Drainage and Groundwater Conservation District.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

C.S.H.B. 5320 transfers and redesignates provisions of the Special District Local Laws Code relating to the Starr County Drainage District and the Starr County Groundwater Conservation District and further amends those provisions as follows:

·consolidates the districts into a combined drainage and groundwater conservation district named the Starr County Drainage and Groundwater Conservation District;

·clarifies that the district has the rights, powers, privileges, functions, and duties provided under Water Code provisions relating to groundwater conservation districts, as is specified for the groundwater conservation district under current law;

·changes the composition of the district's board from consisting of the commissioners court of Starr County as is the case for the drainage district, or five elected directors as is the case for the groundwater conservation district, to consisting of the following directors appointed by the county commissioners court: one director who is a bona fide agricultural producer from whom a substantial portion of the person's income is derived from conducting agricultural business in the district, one director who is an employee of a rural water supply entity in the district, one director who represents municipal interests in the district, one director who represents active industrial interests in the district, and one director who represents Starr County at large; and

·authorizes the district to impose a property tax as provided by Water Code provisions generally applicable to all water districts.

C.S.H.B. 5320 repeals provisions relating to the nature, district boundaries, and required confirmation election of the Starr County Groundwater Conservation District as well as those relating to the district's elected board of directors, the district's authority to act as a court-appointed receiver, and the district's authority to enter into a merger agreement with a water supply or sewer service corporation. The bill retains provisions relating to the district's power to contract with municipalities and its relation to other water-related entities. The bill establishes the following on the bill's effective date:

·the Starr County Groundwater Conservation District is dissolved;

·the terms of the directors of the Starr County Groundwater Conservation District expire;

·any assets and liabilities of the Starr County Groundwater Conservation District are transferred to the Starr County Drainage and Groundwater Conservation District;

·a contract with any party and the Starr County Groundwater Conservation District is a contract between that party and the Starr County Drainage and Groundwater Conservation District;

·an employee of the Starr County Groundwater Conservation District is an employee of the Starr County Drainage and Groundwater Conservation District;

·records of the Starr County Groundwater Conservation District are records of the Starr County Drainage and Groundwater Conservation District; and

·the Starr County Drainage and Groundwater Conservation District may, in all respects, conduct the affairs of the Starr County Groundwater Conservation District as provided by the bill.

The bill requires the Starr County Drainage and Groundwater Conservation District to take any action necessary to close the affairs of the Starr County Groundwater Conservation District, including the filing of any dissolution documents with the Texas Commission on Environmental Quality (TCEQ).

C.S.H.B. 5320 establishes that all applicable requirements relating to the following have been fulfilled and accomplished with respect to the bill:

·the legal notice of intention to introduce;

·governor action;

·TCEQ recommendations; and

·the state constitution and laws and legislative rules and procedures.

C.S.H.B. 5320 repeals the following provisions of the Special District Local Laws Code:

·Subchapters A, B, and D, Chapter 8803;

·Sections 8803.101 and 8803.102;

·the heading to Subchapter C, Chapter 8803; and

·the heading to Chapter 8803.

EFFECTIVE DATE

On passage, or, if the bill does not receive the necessary vote, September 1, 2025.

COMPARISON OF INTRODUCED AND SUBSTITUTE

While C.S.H.B. 5320 may differ from the introduced in minor or nonsubstantive ways, the following summarizes the substantial differences between the introduced and committee substitute versions of the bill.

The substitute includes provisions that were not in the introduced establishing the following on the bill's effective date:

·the Starr County Groundwater Conservation District is dissolved;

·the terms of the directors of the Starr County Groundwater Conservation District expire;

·any assets and liabilities of the Starr County Groundwater Conservation District are transferred to the Starr County Drainage and Groundwater Conservation District;

·a contract with any party and the Starr County Groundwater Conservation District is a contract between that party and the Starr County Drainage and Groundwater Conservation District;

·an employee of the Starr County Groundwater Conservation District is an employee of the Starr County Drainage and Groundwater Conservation District;

·records of the Starr County Groundwater Conservation District are records of the Starr County Drainage and Groundwater Conservation District; and

·the Starr County Drainage and Groundwater Conservation District may, in all respects, conduct the affairs of the Starr County Groundwater Conservation District as provided by the substitute.

The substitute includes a provision that was not in the introduced requiring the Starr County Drainage and Groundwater Conservation District to take any action necessary to close the affairs of the Starr County Groundwater Conservation District, including the filing of any dissolution documents with the TCEQ.

Whereas the introduced required the Starr County Drainage and Groundwater Conservation District to assess property taxes, the substitute authorizes the district to impose such taxes.

Whereas the introduced did not affect provisions relating to the Starr County Groundwater Conservation District, the substitute repeals provisions relating to the district, except for provisions relating to the district's power to contract with municipalities and its relation to other water-related entities, which mirror those added by the introduced for the Starr County Drainage and Groundwater Conservation District and which the substitute instead transfers to that district.

The substitute includes provisions that were not in the introduced establishing that all applicable requirements relating to the following have been fulfilled and accomplished with respect to the bill:

·the legal notice of intention to introduce;

·governor action;

·TCEQ recommendations; and

·the state constitution and laws and legislative rules and procedures.

House Authors

Rep. Ryan GuillenRepublican · Primary Author

Senate Sponsor

Sen. Judith ZaffiriniDemocrat · Primary Sponsor

Bill Text(with markup)

H.B. No. 5320

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

	AN ACT
	relating to the powers, duties, and governance of the Starr County
	Drainage District, the change of the name of the Starr County
	Drainage District to the Starr County Drainage and Groundwater
	Conservation District, the dissolution of the Starr County
	Groundwater Conservation District, and the transfer of the assets
	and liabilities of the Starr County Groundwater Conservation
	District to the Starr County Drainage and Groundwater Conservation
	District; authorizing the imposition of a tax.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1. Chapter 6606, Special District Local Laws Code,
	is transferred to Subtitle X, Title 6, Special District Local Laws
	Code, redesignated as Chapter 11022, Special District Local Laws
	Code, and amended to read as follows:
	CHAPTER 11022 [~~6606~~]. STARR COUNTY DRAINAGE AND GROUNDWATER
	CONSERVATION DISTRICT
	SUBCHAPTER A. GENERAL PROVISIONS
	Sec. 11022.0101 [~~6606.001~~]. DEFINITIONS. In this
	chapter:
	(1) "Board" means the district's board of directors.
	(2) "Director" means a member of the board.
	(3) "District" means the Starr County Drainage and
	Groundwater Conservation District.
	Sec. 11022.0102 [~~6606.002~~]. NATURE OF DISTRICT. The
	district is a drainage and groundwater conservation district
	created in Starr County under Section 59, Article XVI, Texas
	Constitution[~~, subject to approval at a confirmation election under~~
	~~Section 6606.102~~].
	Sec. 11022.0103 [~~6606.003~~]. FINDINGS OF BENEFIT AND
	PURPOSE. (a) The district is created to serve a public use and
	benefit.
	(b) All land and other property included in the district
	will benefit from the works and projects that are to be accomplished
	by the district under powers conferred by Section 59, Article XVI,
	Texas Constitution.
	(c) The district is essential to accomplish the purposes of
	Section 59, Article XVI, Texas Constitution.
	Sec. 11022.0104 [~~6606.004~~]. DISTRICT TERRITORY. The
	district territory is coextensive with the boundaries of Starr
	County, Texas.
	SUBCHAPTER B. BOARD OF DIRECTORS
	Sec. 11022.0201 [~~6606.051~~]. DIRECTORS. [~~(a)~~] The district
	is governed by a board of five directors appointed by the
	[~~consisting of the~~] Commissioners Court of Starr County as follows:
	(1) one director who is a bona fide agricultural
	producer for whom a substantial portion of the person's income is
	derived from conducting agricultural business in the district;
	(2) one director who is an employee of a rural water
	supply entity in the district;
	(3) one director who represents municipal interests in
	the district;
	(4) one director who represents active industrial
	interests in the district; and
	(5) one director who represents Starr County at large.
	[~~(b)~~ ~~Service on the board is an additional duty of office~~
	~~for a member of the Commissioners Court of Starr County.~~]
	SUBCHAPTER C. POWERS, [~~AND~~] DUTIES, AND FINANCIAL PROVISIONS
	Sec. 11022.0301 [~~6606.101~~]. GENERAL POWERS AND DUTIES.
	(a) The district has all rights, powers, privileges, functions,
	and duties provided by the general law of this state applicable to a
	drainage district created under Section 59, Article XVI, Texas
	Constitution, including Chapters 36, 49, and 56, Water Code.
	(b) The district may impose an ad valorem tax as provided by
	Chapter 49, Water Code.
	[~~Sec.~~ ~~6606.102.~~ ~~CONFIRMATION ELECTION. (a) The board~~
	~~shall hold an election to confirm the creation of the district.~~
	[~~(b)~~ ~~Section 41.001(a), Election Code, does not apply to a~~
	~~confirmation election under this section.~~
	[~~(c)~~ ~~Except as provided by this section, the confirmation~~
	~~election must be conducted as provided by Sections 49.102(a)-(f),~~
	~~Water Code, and the Election Code.~~
	[~~(d)~~ ~~The district is not required to elect directors at the~~
	~~confirmation election.~~]
	Sec. 11022.0302 [~~6606.103~~]. UTILITY PROPERTY EXEMPTION
	FROM IMPACT FEES, STANDBY FEES, AND ASSESSMENTS. The district may
	not impose an impact fee, standby fee, or assessment on the
	property, including the equipment, rights-of-way, easements,
	facilities, or improvements, of:
	(1) an electric utility or a power generation company
	as defined by Section 31.002, Utilities Code;
	(2) a gas utility as defined by Section 101.003 or
	121.001, Utilities Code;
	(3) a telecommunications provider as defined by
	Section 51.002, Utilities Code; or
	(4) a person who provides to the public cable
	television or advanced telecommunications services.
	SECTION 2. Sections 8803.103 and 8803.104, Special District
	Local Laws Code, are transferred to Subchapter C, Chapter 11022,
	Special District Local Laws Code, as added by this Act,
	redesignated as Sections 11022.0303 and 11022.0304, Special
	District Local Laws Code, and amended to read as follows:
	Sec. 11022.0303 [~~8803.103~~]. POWER TO CONTRACT WITH
	MUNICIPALITIES. The district may enter into a contract with a
	municipality to assume the functions of the municipality's
	municipally owned utility. A contract under this section may
	include provisions for the district's:
	(1) assumption of the debts, liabilities, and
	obligations of the municipally owned utility;
	(2) ownership or use of the assets and facilities of
	the municipally owned utility; and
	(3) performance of the functions and services
	previously provided by the municipally owned utility.
	Sec. 11022.0304 [~~8803.104~~]. RELATION TO OTHER
	WATER-RELATED ENTITIES. (a) To the extent that a rule of the
	district conflicts with a rule of the regional water authority, the
	rule of the authority controls.
	(b) To the extent that a rule of the district conflicts with
	an action of a municipally owned utility or water supply or sewer
	service corporation whose certificated area is located wholly or
	partly in the district's territory, the action of the utility or
	corporation controls.
	(c) Notwithstanding Subsections (a) and (b), to the extent
	that a rule of the district concerning groundwater conflicts with a
	rule of the regional water authority or with an action of a
	municipally owned utility or water supply or sewer service
	corporation whose certificated area is located wholly or partly in
	the district's territory, the rule of the district controls.
	SECTION 3. The following provisions of the Special District
	Local Laws Code are repealed:
	(1) Subchapters A, B, and D, Chapter 8803;
	(2) Sections 8803.101 and 8803.102;
	(3) the heading to Subchapter C, Chapter 8803; and
	(4) the heading to Chapter 8803.
	SECTION 4. (a) On the effective date of this Act:
	(1) the Starr County Groundwater Conservation
	District is dissolved;
	(2) the terms of the directors of the Starr County
	Groundwater Conservation District expire;
	(3) any assets and liabilities of the Starr County
	Groundwater Conservation District are transferred to the Starr
	County Drainage and Groundwater Conservation District;
	(4) a contract with any party and the Starr County
	Groundwater Conservation District is a contract between that party
	and the Starr County Drainage and Groundwater Conservation
	District;
	(5) an employee of the Starr County Groundwater
	Conservation District is an employee of the Starr County Drainage
	and Groundwater Conservation District;
	(6) records of the Starr County Groundwater
	Conservation District are records of the Starr County Drainage and
	Groundwater Conservation District; and
	(7) the Starr County Drainage and Groundwater
	Conservation District may, in all respects, conduct the affairs of
	the Starr County Groundwater Conservation District as provided by
	Subsection (b) of this section.
	(b) The Starr County Drainage and Groundwater Conservation
	District shall take any action necessary to close the affairs of the
	Starr County Groundwater Conservation District, including the
	filing of any dissolution documents with the Texas Commission on
	Environmental Quality.
	SECTION 5. (a) The legal notice of the intention to
	introduce this Act, setting forth the general substance of this
	Act, has been published as provided by law, and the notice and a
	copy of this Act have been furnished to all persons, agencies,
	officials, or entities to which they are required to be furnished
	under Section 59, Article XVI, Texas Constitution, and Chapter 313,
	Government Code.
	(b) The governor, one of the required recipients, has
	submitted the notice and Act to the Texas Commission on
	Environmental Quality.
	(c) The Texas Commission on Environmental Quality has filed
	its recommendations relating to this Act with the governor, the
	lieutenant governor, and the speaker of the house of
	representatives within the required time.
	(d) All requirements of the constitution and laws of this
	state and the rules and procedures of the legislature with respect
	to the notice, introduction, and passage of this Act are fulfilled
	and accomplished.
	SECTION 6. This Act takes effect immediately if it receives
	a vote of two-thirds of all the members elected to each house, as
	provided by Section 39, Article III, Texas Constitution. If this
	Act does not receive the vote necessary for immediate effect, this
	Act takes effect September 1, 2025.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION


April 22, 2025

TO:	Honorable Cody Harris, Chair, House Committee on Natural Resources

FROM:	Jerry McGinty, Director, Legislative Budget Board

IN RE:	HB5320 by Guillen (Relating to the combination of the Starr County Drainage and Groundwater conservation districts.), As Introduced

No significant fiscal implication to the State is anticipated.

It is assumed that any costs associated with the bill could be absorbed using existing resources.

Local Government Impact

The fiscal implications of the bill to the district cannot be determined due to the circumstances relating to the district's issuance of assessments, fees, and taxes being unknown. No fiscal implication to other units of local government is anticipated.

Source Agencies:

LBB Staff:

JMc, TUf, BC, CWi

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Frequently Asked Questions

Common questions about HB5320

What does Texas HB5320 do?

Effective September 1, 2025, HB5320 dissolves the Starr County Groundwater Conservation District and consolidates its regulatory authority and assets into the newly renamed Starr County Drainage and Groundwater Conservation District. This legislation centralizes control over both surface drainage and subsurface groundwater, grants the new District expanded ad valorem taxing authority under Water Code Chapter 49, and mandates a complete restructuring of the Board of Directors. Implementation Timeline Effective Date: September 1, 2025.

Who authored HB5320?

HB5320 was authored by Texas Representative Ryan Guillen during the Regular Session.

When was HB5320 signed into law?

HB5320 was signed into law by Governor Greg Abbott on June 20, 2025.

Which agencies enforce HB5320?

HB5320 is enforced by Starr County Drainage and Groundwater Conservation District, Starr County Commissioners Court and Texas Commission on Environmental Quality (TCEQ).

How urgent is compliance with HB5320?

The compliance urgency for HB5320 is rated as "moderate". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

What is the cost impact of HB5320?

The cost impact of HB5320 is estimated as "medium". This may vary based on industry and implementation requirements.

What topics does HB5320 address?

HB5320 addresses topics including starr county drainage and groundwater conservation district, county government, county government--general, environment and environment--water.

Legislative data provided by LegiScanLast updated: November 25, 2025

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