Relating to water losses reported by certain municipally owned utilities to the Texas Water Development Board; authorizing administrative penalties.

Contracts

• Vendor Bifurcation: You must amend procurement policies to ensure independence. The law prohibits the person who prepares the water audit from validating it. You must hold separate contracts for Audit Preparation and Audit Validation.
• Scope of Work (SOW): New contracts for validators must explicitly reference adherence to TWDB validation guidelines and include professional liability coverage for validation errors.

Hiring/Training

• External Consultants: Immediate procurement is required for a certified third-party validator.
• Internal Staff: Engineering and finance teams must collaborate to generate the financial ROI data required for the Mitigation Plan (cost of implementation vs. value of water saved).

Reporting & Record-Keeping

• New Filing: The Water Loss Mitigation Plan is a new statutory document requiring 1, 3, 5, and 10-year targets for water loss reduction.
• Annual Integration: Progress against this plan must be tracked and included in the existing Annual Water Conservation Report.
• Audit Trail: You must retain documentation proving the validator’s certification and independence from the audit preparation team.

Fees & Costs

• Consulting Fees: Budget immediately for third-party validation services.
• Penalty Risk: A $25,000 administrative penalty applies for failure to submit the Mitigation Plan. This is a strict liability provision ("shall assess").