State senator files bill to boost transparency at Agua SUD

State Sen. Juan “Chuy” Hinojosa filed a bill Monday to address long-running concerns about how the Agua Special Utility District conducts business.

Senate Bill 2552 would require utility district board members to submit financial statements to the Texas Ethics Commission, require the utility district to create a searchable database of expenditures and require board members to meet stringent ethical standards.

“I appreciate Agua SUD’s leadership working with me to develop this legislation to further increase transparency and accountability of this important utility district,” Hinojosa said in a statement. “The updated operating procedures, standards of conduct, budget transparency, and ethics guidelines recommended in this bill are important to ensure a strong governance structure with the highest level of integrity and accountability.”

Hinojosa consulted with utility district General Manager Jose E. “Eddie” Saenz, utility district attorney Frank Garza and utility board President Esequiel “Zeke” Ortiz Jr. about the legislation.

They provided suggestions and feedback that shaped the bill, which may be revised during the legislative process.

“As board president of Agua SUD, we want to reassure the community that we are working together in close partnership with Senator Hinojosa on this legislation,” Ortiz said in a statement.

The utility board clashed with Hinojosa in 2017, when he filed Senate Bill 814.

Board members solicited resolutions from western Hidalgo County cities, hired lobbyists and sent administrators to argue their case in Austin. The bill passed anyway.

In 2019, the board adopted a different approach.

With support from the board, Saenz and Garza provided feedback to Hinojosa’s staff throughout the process.

“It’s transparency that he’s asking for,” Ortiz said in an interview. “That’s what we’re going to help him with.”

State law already included provisions designed to provide transparency.

Section 7201 of the Special District Local Laws Code, which governs the utility district, requires the board to publish financial information.

“The district shall maintain an Internet website with current information concerning agendas, minutes, policies, monthly financial information concerning revenues and expenses, and quarterly summaries,” according to Section 7201.204, which applies only to the utility district. “The district shall provide information, including summary financial information based on the preceding year’s annual audit, to district customers at an annual meeting.”

In the bill, Hinojosa proposed revisions to that section and added another, Section 7201.104, which requires the utility district to publish additional information.

“The district shall establish and post on the district’s Internet website a database of district check register reports, including district expenditures and contracts. The database must include the amount, date, description, payor, and payee of the expenditures, and, if applicable, parties to the contract,” according to the bill. “The district shall prominently display a link to the database established under this section on the district’s Internet website. The information provided in the district check register reports must be updated monthly.”

As the bill moves through the legislative process, it may be amended to include a switch from at-large representation — which reserves five seats on the board for cities and two for county customers — to single-member districts. Every district would contain a roughly equal number of residents.

The Texas Senate referred the bill to the Committee on Intergovernmental Relations, which is headed by state Sen. Eddie Lucio Jr. of Brownsville.