SB 2161

relating to expenses incurred in the appeal of rates for water or
sewer service charged to certain customers.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1.  Section 13.043, Water Code, is amended by
amending Subsection (e) and adding Subsections (e-1) and (e-2) to
(e)  In an appeal under Subsection (b), the utility
commission shall hear the appeal de novo and shall fix in its final
order the rates the governing body should have fixed in the action
from which the appeal was taken.  The utility commission may
establish the effective date for the utility commission's rates at
the original effective date as proposed by the service provider
and[,] may order refunds or allow a surcharge to recover lost
revenues[, and may allow recovery of reasonable expenses incurred
by the retail public utility in the appeal proceedings.  The utility
commission may consider only the information that was available to
the governing body at the time the governing body made its decision
and evidence of reasonable expenses incurred by the retail public
utility in the appeal proceedings].  The rates established by the
utility commission in an appeal under Subsection (b) remain in
effect until the first anniversary of the effective date proposed
by the retail public utility for the rates being appealed or until
changed by the service provider, whichever date is later, unless
the utility commission determines that a financial hardship exists.
(e-1)  Any party represented by counsel who alleges that
existing rates are excessive or that rates prescribed by a
governing body are excessive and who is a prevailing party in
proceedings for review of a governing body decision may in the same
action recover reasonable fees for attorneys and expert witnesses
and other costs incurred by the prevailing party before the utility
commission.  The amount of the attorney's fees shall be fixed by the
(e-2)  On a finding by the utility commission that an action
under this subchapter was groundless and brought in bad faith and
for the purpose of harassment, the utility commission may award to
the defendant retail public utility reasonable attorney's fees.
SECTION 2.  The changes in law made by this Act apply only to
an appeal under Section 13.043(b), Water Code, that is filed on or
after the effective date of this Act.  An appeal that is filed
before the effective date of this Act is governed by the law in
effect on the date the appeal was filed, and the former law is
continued in effect for that purpose.
SECTION 3.  This Act takes effect September 1, 2025.