Lawmakers near deal to spend $20 billion over two decades on water crisis

Subscribe to The Y’all — a weekly dispatch about the people, places and policies defining Texas, produced by Texas Tribune journalists living in communities across the state.

---

Texas lawmakers reached a deal this week, passing a sweeping plan to invest billions into the state’s fragile water infrastructure and future water supply over the next 20 years, ending months of tense, back door negotiations.

On Tuesday, the Senate approved House Joint Resolution 7, which will send to voters in November a proposal to allot $1 billion a year starting in 2027— $20 billion in total — until 2047 to secure the state’s water supply. That money will be used to fund new water supply projects, such as desalination, repairing old water infrastructure, conservation and flood mitigation projects.

Meanwhile, the House gave final approval Wednesday to Senate Bill 7, by Sen. Charles Perry, R-Lubbock, which lays out the administrative framework for funding water projects through the Texas Water Development Board. Lawmakers also agreed to a one-time investment of $2.5 billion into the water fund from House Bill 500, the supplemental budget, which is taken from the current budget surplus. About $880 million of that is already in the fund, so more than $1.6 billion will be deposited.

Addressing the state’s water crisis has been a big priority for lawmakers and Gov. Greg Abbott this year. Texas is running out of water, and fast. With aging pipes, drought pressure, and population growth squeezing resources, Abbott called water an “emergency item.”

The $20 billion deal is a step forward, but the funding is a fraction of what Texas needs to fully fix the problem.

A Texas 2036 report estimated that the state needs nearly $154 billion by 2050 for water infrastructure, including $59 billion for water supply projects, $74 billion for leaky pipes and infrastructure maintenance, and $21 billion to fix broken wastewater systems.

The funding also dries up in 2047, and unlike similar constitutional funds, such as those dedicated to transportation, the Legislature cannot extend the tax dedication by resolution. The Legislature, more than two decades from now, will have to amend the state constitution, again — with another two-thirds vote — to keep the money flowing. It will also be put to another state referendum.

And as climate change accelerates, urban demand skyrockets, and critical infrastructure ages, this deal may prove to be a down payment. Perry acknowledged the shortfall on the Senate floor, but applauded the initial step.

“This plan is a good start to make that goal,” Perry said.

Both bills have changed quite a bit throughout the legislative process. The biggest point of contention was how the annual $1 billion would be spent. The original House plan gave the Texas Water Development Board wide discretion over how to use the money. Waters experts said under that plan, local leaders would have had flexibility to prioritize their community’s most pressing needs — whether cleaning salty water to make drinkable or repairing leaky pipes.

However, a Senate push led by Perry locked in 80% of the funds for new water supply projects, such as desalination and treating oilfield wastewater. Under that plan, the remaining 20% would be reserved for repairs, conservation, and flood mitigation. The fight over that ratio became the flashpoint of the legislative debate.

On Monday, both those proposals were walked back to a 50-50 split by an amendment added to the Senate bill by state Rep. Cody Harris, R-Palestine. The first half of the money would got to conservation and water reuse projects, desalinating groundwater and seawater, building pipelines, and developing reservoirs. The remaining would go to the water board, where the staff will determine how to spend the money.

During the discussion Monday about the Senate bill, Rep. Vikki Goodwin, D-Austin, cited a neighborhood in her district with chronic water line failures and old pipes that need repair. She asked if the water bill will help communities like that one with leaking pipes. Harris assured her the bill “absolutely” addresses that.

“Being able to fix existing failing infrastructure is a major focus of this bill,” he said.

The Senate and House need to approve each chamber's amendments, which they’re expected to do, before the legislation can be sent to Abbott’s desk.

Disclosure: Texas 2036 has been a financial supporter of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune's journalism. Find a complete list of them here.

---

First round of TribFest speakers announced! Pulitzer Prize-winning columnist Maureen Dowd; U.S. Rep. Tony Gonzales, R-San Antonio; Fort Worth Mayor Mattie Parker; U.S. Sen. Adam Schiff, D-California; and U.S. Rep. Jasmine Crockett, D-Dallas are taking the stage Nov. 13–15 in Austin. Get your tickets today!