AUSTIN, Texas — The Texas Senate unanimously passed a bill on Wednesday to improve water infrastructure in Texas and overhaul the funding of water projects across the state.
“Senate Bill 7 is about how we go about making sure an accountability system is in place for that funding,” the bill’s author State Sen. Charles Perry (R-Lubbock) said. “The bill expands the categories of water supply projects that can receive funding from the new water supply fund, specifically reservoirs that are shovel ready.”
Gov. Greg Abbott has named water infrastructure funding an emergency item this session, and the bill is a top priority for the Senate leader, Lt. Gov. Dan Patrick.
It would establish the Texas Water Fund Advisory Committee and the Office of Water Supply Conveyance Coordination and create the New Water Supply for Texas Fund to finance desalination, aquifer storage and inter-regional water transportation projects.
The bill introduces best practices for water conveyance infrastructure, encourages the use of existing utility easements to reduce the need for eminent domain and mandates biennial reports on water supply project progress and financial performance.
The Texas Water Fund Advisory Committee and the Office of Water Supply Conveyance Coordination would serve as oversight committees to help improve connectivity between the state and regional levels.
The plan would take money from state sales and insurance premium taxes to create additional water supplies and reduce water demand through conservation and reuse.
SB 7 would expand the types of water projects eligible for state funding and prioritize financial assistance for wastewater treatment projects in small communities with a population of less than 150,000.
“Senate Bill 7 is taking a more coordinated oversight of how we plan for water in the future. If it’s implemented correctly, as I believe it will, we will create a hub and spoke environment to where large water suppliers of today will be able to have more water supply to be able to distribute to communities that could not afford to do it on their own,” Perry said. “That’s kind of the magic behind Senate Bill 7. It’s that coordinated approach of having a target for all water supplies and future development to shoot for and shoot to.”
The bill would also prohibit new water supply projects from using existing freshwater to prevent the depletion of existing resources.
“Senate Bill 7 prohibits the use of state funding for new water projects to buy in-state surface water rights out of their basins of origin,” Perry said. “It also provides private protection over groundwater rights prohibiting the movement of fresh water at the groundwater level across the states of the new pipes or the new vehicles as afforded to by Senate Bill 7.”
The bill follows a 2022 study by the Texas Water Development Board that pointed to concerns over a possible future water shortage in Texas. That report estimated that more than 50 million people would be living in Texas by 2070, and water shortages alone could lead to 1.4 million jobs and $92 billion in Gross Domestic Product (GDP) being lost. The 2022 state water plan also projected that the state’s municipal demands will surpass current water supplies in 2030.
Concerns have also been raised about the construction of big projects, including AI data centers, putting even more strain on the state’s water supply. A report from Environment Texas details how one data center can consume up to 5 million gallons a day by cooling off hundreds or thousands of computers that quickly heat up.
According to Austin Water, the average water use per person in Austin is 131 gallons a day, or about twice the volume of a bathtub.
In the 88th Texas Legislature, lawmakers invested $1 billion in water projects and infrastructure.
SB 7 now heads to the House for consideration. State Rep. Cody Harris (R-Palestine) has introduced House Bill 16, a sweeping piece of legislation covering similar water issues. While both proposals would funnel up to $1 billion a year to the Texas Water Fund, there are notable differences in funding and how the money would be spent.