A retail public utility may keep serving an area if a municipality expands into it, but the utility commission is barred from extending a municipality’s certificate in some situations. The commission may also decertify an area if the municipality fails to provide service within five years, subject to stated exceptions.
Sec. 13.2451. EXTENSION BEYOND EXTRATERRITORIAL JURISDICTION. (a) Except as provided by Subsection (b), if a municipality extends its extraterritorial jurisdiction to include an area certificated to a retail public utility, the retail public utility may continue and extend service in its area of public convenience and necessity under the rights granted by its certificate and this chapter. (b) The utility commission may not extend a municipality's certificate of public convenience and necessity beyond its extraterritorial jurisdiction if an owner of land that is located wholly or partly outside the extraterritorial jurisdiction elects to exclude some or all of the landowner's property within a proposed service area in accordance with Section 13.246(h). This subsection does not apply to a transfer of a certificate as approved by the utility commission. (b-1) Subsection (b) does not apply to an extension of extraterritorial jurisdiction in a county that borders the United Mexican States and the Gulf of Mexico or a county adjacent to such a county. (b-2) Subsection (b) does not apply to an extension of extraterritorial jurisdiction in a county: (1) with a population of more than 30,000 and less than 36,000 that borders the Red River; or (2) with a population of more than 100,000 and less than 200,000 that borders a county described by Subdivision (1). (b-3) Subsection (b) does not apply to an extension of extraterritorial jurisdiction in a county: (1) with a population of 170,000 or more that is adjacent to a county with a population of 1.5 million or more that is within 200 miles of an international border; or (2) with a population of more than 40,000 and less than 50,000 that contains a portion of the San Antonio River. (c) The utility commission, after notice to the municipality and an opportunity for a hearing, may decertify an area outside a municipality's extraterritorial jurisdiction if the municipality does not provide service to the area on or before the fifth anniversary of the date the certificate of public convenience and necessity was granted for the area. This subsection does not apply to a certificate of public convenience and necessity for an area: (1) that was transferred to a municipality on approval of the utility commission; and (2) in relation to which the municipality has spent public funds. (d) To the extent of a conflict between this section and Section 13.245, Section 13.245 prevails. Added by Acts 2005, 79th Leg., Ch. 1145 (H.B. 2876), Sec. 5, eff. September 1, 2005. Amended by: Acts 2007, 80th Leg., R.S., Ch. 1430 (S.B. 3), Sec. 2.08, eff. September 1, 2007. Acts 2011, 82nd Leg., R.S., Ch. 1325 (S.B. 573), Sec. 2, eff. September 1, 2011. Acts 2013, 83rd Leg., R.S., Ch. 170 (H.B. 1600), Sec. 2.46, eff. September 1, 2013. Acts 2013, 83rd Leg., R.S., Ch. 171 (S.B. 567), Sec. 46, eff. September 1, 2013. Acts 2023, 88th Leg., R.S., Ch. 644 (H.B. 4559), Sec. 275, eff. September 1, 2023.