Across South Texas, families, farmers, and local leaders continue to face pressing water challenges. Persistent drought, aging infrastructure, and unreliable water deliveries from the Rio Grande and the historic low levels of water in our lakes in the Coastal Bend have strained regional water supplies. During the 89th Regular Legislative Session, the Texas Legislature passed several major initiatives to address the state’s long-term water infrastructure and supply needs.

A New Water Funding Framework: SB 7, HJR 7, and HB 500
One of the session’s most significant water policy accomplishments was the passage of a three-part funding package: Senate Bill 7 (SB 7), House Joint Resolution 7 (HJR 7), and House Bill 500 (HB 500).

The Texas Water Fund (TWF)—originally established with overwhelming voter support in 2023—is positioned to become the state’s central financing mechanism for water infrastructure and supply projects. Although the Legislature made a one-time $1 billion deposit in 2023 through SB 30, the fund lacked a stable long-term funding source.

To address that gap, SB 7 and HJR 7 were passed to propose a new constitutional amendment—Proposition 4—that will appear on the statewide ballot this November. If approved, the amendment would dedicate up to $1 billion in state sales tax revenue annually from 2027 to 2047 to the Texas Water Fund, representing a potential $20 billion investment over two decades. The amendment would also restrict the Legislature from altering the allocation formula for the first 10 years, providing additional certainty for long-term planning. At least half of the funds would be dedicated to developing new water supplies, with the remaining funds directed toward infrastructure improvements prioritized by the Texas Water Development Board (TWDB).

SB 7 also expands the TWF’s flexibility by allowing transfers to existing TWDB programs, including the Flood Infrastructure Fund (FIF), Economically Distressed Areas Program (EDAP), Agricultural Water Conservation Fund (AWCF), and New Water Supply for Texas Fund (NWSTF). It redefines eligible uses of the NWSTF to include reuse projects, acquisition of out-of-state water rights, reservoir development, and conveyance infrastructure.

To support these initiatives, HB 500 appropriates over $2.5 billion to TWDB—including an initial $1 billion deposit into the TWF—and additional funds for agency staffing, technical assistance, environmental permit coordination, and federal fund matching. Some local projects will also receive funding through HB 500. For example, in Nueces County, HB 500 appropriated $30 million for the Nueces River Ground Water Wells, $16 million for the Mary Rhodes Pipeline upgrades, and $4 million for the Nueces County Drainage District No. 2. In Hidalgo County, HB 500 appropriated $15 million for the Delta Region Water Management Project, $8 million for the City of Weslaco Water and Drainage Improvements, $5.3 million for the City of Alamo Lift Station upgrades, and $750,000 for the City of Penitas Lift Station. These investments will help ensure that the TWDB can administer expanded programs and respond to growing demand for water financing.

SB 1967: Unlocking New Supplies Through Floodwater Reuse
Another major policy shift came with the passage of Senate Bill 1967 (SB 1967), which I authored and passed with the support of Representative Mando Martinez. This bill expands eligibility under the Flood Infrastructure Fund (FIF) to include multi-purpose flood mitigation projects that also generate new water supplies. Eligible projects may now include infrastructure to capture, divert, treat, and distribute stormwater, agricultural runoff, and treated wastewater for reuse.

This change directly benefits Hidalgo County, where the Delta Region Water Management Project, led by Hidalgo County Drainage District No. 1, aims to address both flooding and water scarcity. The project proposes a series of treatment facilities that collect and process stormwater and treated effluent to augment regional supplies. With $30 million already committed locally, SB 1967 now makes this dual-purpose model eligible for FIF grants and loans from the TWDB.

The bill also authorizes drainage districts—even those without retail water service—to qualify for financing through the Water Loan Assistance Fund (WLAF) if their projects include a water supply and flood mitigation component. To reflect this change, SB 1967 requires TWDB to revise its point system for project prioritization under SWIFT and the state water plan to ensure multi-purpose projects like these receive appropriate consideration.

These reforms help communities across Texas—particularly in the Valley—access new tools to address both flood control and water supply challenges together.

Other Measures to Promote Conservation
In addition to new funding mechanisms, the Legislature passed reforms to improve water conservation and system efficiency:

HB 29 requires large utilities (over 150,000 connections) to conduct annual water loss audits and implement mitigation plans. In South Texas, where aging infrastructure contributes to high leakage rates, this reform could reduce losses by up to 270,000 acre-feet annually—enough to supply 1.7 million Texans.

HB 517 prohibits homeowners’ associations from penalizing residents for brown or discolored lawns during drought-related watering restrictions, reinforcing conservation efforts in dry regions like the Rio Grande Valley.

A Step Forward, But Not the Last
While these legislative actions represent major progress, their success depends on timely implementation by state agencies and active participation from local governments. Voter approval of Proposition 4 in November is critical to ensuring the Texas Water Fund receives its long-term revenue stream.

These measures will not solve every challenge overnight. Texas faces an estimated $154 billion in water infrastructure needs over the next 50 years. But with new funding tools, broader project eligibility, and a clearer path to implementation, communities in South Texas and across the state are better positioned to improve water reliability, resilience, and access.

Water is life. And in this session, the Texas Legislature took practical, forward-looking steps to help secure it.

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