2/21/25
The House Agriculture, Acequias and Water Resources Committee introduced a committee substitute for HB 311 (CS/HB 311 HAAWC) that enacts the Reclaimed Water Act with thirteen definitions ranging from authority to reclaimed water producer. It directs the NM Environment Department (NMED), upon a request from a municipality or county, to authorize a municipality or county to create a reclaimed water authority to work with communities in the authority's jurisdiction to promote the use of reclaimed water, conditioned on the request containing the required information including the authority’s business plan; proposed sources and volumes of reclaimed water; and the area to be served. CS/HB 311 HAAWC requires the NMED to approve or deny a request within sixty days of its submittal and prohibits the NMED from approving more than ten requests for such authorities before 1 July 2026.
CS/HB 311 HAAWC instructs an authority to organize as a nonprofit corporation in compliance with the state’s Nonprofit Corporation Act and the Reclaimed Water Act. It establishes that an authority’s board will consist of six members, five of whom will be voting members. The term of a member of an authority’s board is two years with initial terms staggered. The sixth member is an appointee of the secretary of the environment and acts as an advisor. The other members are appointed by the mayor or a county’s governing body and have certain professional expertise with at least three years of experience in that field.  CS/HB 311 HAAWC requires the authority’s board to appoint a chair; elect other officers; adopt bylaws; hire or appoint a president who serves as chief administrative officer; and provide a report that identifies potential local reclaimed water sources and potential uses for this water every six months to the appropriate regional water planning entity and to the Interstate Stream Commission (ISC). 
CS/HB 311 HAAWC delineates the powers of the board, some of which are common to the Nonprofit Corporation Act and some unique to the Reclaimed Water Act including being able to operate and maintain lawfully permitted water treatment facilities, desalination plants, laboratories, water transportation equipment and vehicles and water storage equipment and facilities; to make grants to promote reclaimed water; and to engage in regional water planning and community outreach and educational programs.
CS/HB 311 HAAWC lists the purposes of an authority including encouraging the responsible use of reclaimed water; fostering and promoting uses for reclaimed water that support the development of new industries and the diversification of the state's economy;  providing quarterly reports to the NMED and the Economic Development Department; and adoption of policies and procedures for membership in the authority. Those entities or persons who become members of an authority will be subject to the policies and procedures adopted by the authority.
CS/HB 311 HAAWC requires a majority vote of the board and an authority’s participating members to adopt administrative rules; construct and operate facilities and infrastructure; and to contract with third parties for certain services relating to reclaimed water. It states that a reclaimed water authority is subject to all applicable rules and laws governing water rights; transportation and handling of water; and water quality. It prohibits an authority from impairing an existing water right. 
CS/HB 311 HAAWC declares that these authorities are not an agency, public body or political subdivision of the state but that they will be subject to the Open Meetings Act and the Inspection of Public Records Act with limitations on revealing pricing information marked as confidential. It grants immunity from tort liability under the Tort Claim Act to an authority or a board and the authority's or board's officers, directors and employees. It protects a director, president or other officer from being personally liable for certain negligent acts or omissions but not if the action or omission constitutes willful misconduct or recklessness. It allows the authority to enter into agreements with insurance carriers even though the loss may be covered by the Risk Management Fund. 
CS/HB 311 HAAWC charges an authority with identifying potential uses and potential customers for reclaimed water and potential sources of reclaimed water in its jurisdiction. It provides for a retail water supplier to identify these uses, customers and sources with assistance from reclaimed water producers and reclaimed water wholesalers. It requires that the authority or the retail water supplier to disclose this information to the NMED within thirty days of the discovery of this information.
CS/HB 311 HAAWC grants an authority the power to help facilitate communication among customers, reclaimed water producers, reclaimed water wholesalers and retail water suppliers within the authority's jurisdiction; to assist with negotiations of commercial transactions among these listed parties as a mediator; and with a majority vote of the board and participating members, create policies and procedures concerning inspections of reclaimed water or for governing the handling, storage, transportation or disposal of reclaimed water. It authorizes an authority under certain circumstances to facilitate an agreement for a reclaimed water supply.
CS/HB 311 HAAWC requires an authority to post and update quarterly a list of retail water suppliers, customers, reclaimed water producers and reclaimed water wholesalers within the authority's jurisdiction that have expressed interest in providing or using reclaimed water. 
CS/HB 311 HAAWC establishes processes for setting reclaimed water rates for a water supplier regulated by the Public Regulation Commission (PRC). When a regulated water utility requests the PRC to set reclaimed water rates, CS/HB 311 HAAWC requires the PRC to set such rates with the primary consideration of enabling retail water suppliers to promote the sale of reclaimed water in a way that allows for reclaimed water activities to increase within the state and with the objective, where practicable, to create a reasonable economic incentive for a customer to purchase reclaimed water.
CS/HB 311 HAAWC would be effective 1 January 2025.