Senate Bill 2185 relates to the procedures for the dissolution of Hidalgo County Water Improvement District No. 3. It would transfer the assets and liabilities to the City of McAllen.

The water district, quite frankly, has outgrown its purpose. The city and the county has transitioned from a rural, agricultural area, to a vital urban area. 

Water District No. 3, today, is costing the taxpayers of the city of McAllen over $1 million every year for a layer of government that is not necessary. It also leads to increases of water rates for all the residents of the city of McAllen. It forces the City of McAllen into litigation on easements. The city pays higher than market value for their Water District No. 3. 

The easements have slowed down the growth of the City of McAllen. The number of farmers served are a handful, as compared to the almost 150,000 residents of the city of McAllen and the 40,000 residents of the surrounding communities. 

District No. 3 is the smallest district in the Valley due to urbanization. The City of McAllen provides over 90 percent of the district’s revenue. This is another layer of government that is not needed. 

Chairman Bettencourt, adding insult to injury, the district uses City of McAllen taxpayers money to pay for lobbyists to lobby against the interests of the taxpayers of McAllen, to the tune of over $900,000 over the years. 

Water District No. 3 has the highest water rates compared to other districts. They are about 80 percent higher than the City of McAllen pays for other water providers. 

The water district has a history of hindering the election process by excluding properties and potential new board members and by redrawing the boundaries every election to exclude voters who don’t support it. We don’t even know when they had their last election. Or who was on the ballot. And for us this is a real problem. This water district is mismanaged and the general manager, who is also the president of the board, has completely abused his power. 

There is a lack of transparency and accountability. The district does not comply with state laws. They flout the public information act and hide its activities from public scrutiny. I mailed a legislative privilege public information request to the district on March 24, 2021. I have not received a response, even though it was due last week.

There are unethical practices in the water district. It is a one-man show where the president, who is also the general manager of the district… audits into the district have identified contracts entered into by the district with private businesses owned by the general manager and the president of the board. These are in violation of the Local Government Code, Chapter 171 and 176. 

For too many years this individual has used the district to financially benefit his business at the expense of the ratepayers in the city of McAllen. There is a lack of proper oversight on spending. And I know people say, well, it is going to set a bad precedent. If I may add, these water districts are created by the Legislature and we have done away with a whole bunch of them. I have two and a half pages, single line, listing all the water districts, the utility districts, the irrigation districts we the state have done away with under our responsibility. 

I do want to add, Senate Bill 2185 contains protections for the farmers. It eliminates the required payment of any flat tax or assessments paid to the district by landowners in the district. So, it does away with the flat tax and ensures that all water rights that are held in trust by the city for the use previously adjudicated. 

It ensures that all individual water rights users are entitled to continue to use or have access to the same amount of water that they were entitled to before the dissolution of the district. It requires the city to perform all the functions of the district, including the provisions of services and ensures the delivery of water to landowners at or below the lowest comparable delivery charge imposed by any other irrigation district in Hidalgo County.

So, we only have a handful of farmers that are left yet a small group of people control the destiny and the property taxes and the water rates and the flat tax that the residents of the city of McAllen have to pay. And, quite frankly, this district is no longer needed and we ought to do away with it. 

Editor’s Note: The above testimony was given by state Sen. Juan Hinojosa in support of his legislation, Senate Bill 2185, at a hearing of the Senate Committee on Local Government on Monday, April 12, 2021. SB 2185 would would dissolve Hidalgo County Water Improvement District No. 3 and transfer its assets and liabilities to the City of McAllen. 

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