SB 564

ON MARCH 16, 2026, THE HOUSE ADOPTED AMENDMENT #1 AND PASSED HOUSE BILL 803, AS AMENDED. AMENDMENT #1 r ewrites this bill to add to present law concerning sewerage systems using land application. Present law prohibits new construction of, or making any change in a public water supply or public sewerage system, until the plans for such new construction or change have been submitted to and approved by TDEC. For municipal sewage treatment works and wastewater facilities requiring plan a pprovals associated with permits under the Water Quality Control Act for decentralized systems using land application , this amendment adds the following to present law: ( 1 ) Approval of engineering plans and specifications e xpires 12 months from the date of issuance unless c onstruction has commenced or t he owner obtained an extension under ( 2 ) ; ( 2 ) TDEC is authorized to grant extensions in increments not exceeding 12 months, up to a cumulative maximum of 60 months from the original approval date ; ( 3 ) If material changes in design, capacity, treatment process, or site conditions occur, the owner is required to submit revised plans, engineering reports, and specifications to TDEC f or review and approval ; ( 4 ) TDEC is required to maintain an electronic tracking system for plan approvals and extensions ; and ( 5 ) If construction of a decentralized wastewater system using land application is not completed within 60 months, the owner is required to submit new plans, engineering reports, and specifications for review and approval. No decentralized wastewater system using land application may commence operation until construction has been completed in accordance with approved plans. Present law requires the board of water quality, oil and gas to promulgate rules creating a system of incentives for alternatives to discharges to surface waters, such as land application and beneficial reuse of the wastewater. Present law also prohibits the commissioner from approving or certifying a public sewerage system using land application or treatment if the system p roposes to use land having a water table at an elevation which would preclude adequate treatment of the wastewater and which may result in surface or ground water pollution . This amendment adds a requirement that the commissioner, n o later than July 31, 2027, promulgate rules applicable to the design and construction of decentralized wastewater treatment systems using land application. At a minimum, the rules must define material revisions for purposes of determining when a change in plans has occurred , address proper siting, soil characterization, soil mapping, hydraulic loading, redundancy and reserve area requirements, and long-term performance standards to ensure adequate protection of surface waters, groundwater, and public health. Under this amendment, when a developer of a subdivision proposes to construct a treatment works for use by the subdivision, and the design and construction is approved by TDEC, then the developer is required to apply to the utility serving the area in which the system is located requesting that the utility agree to assume operational responsibility and ownership of the treatment works or r efuse to own and operate the treatment works. The full text of this amendment specifies procedural requirements, inclu ding deadlines, for the application process. If a developer receives written notice of the utility's refusal to own and operate the treatment works, or if the utility fails to respond to the application within the allotted time , then the developer may contract with another utility for ownership and operation of the treatment works. This amendment provides a two-year window within which a utility that denies or does not reply to an a pplication may negotiate with the current owner and operator of the treatm ent works to allow the utility to assume operational responsibilities and ownership rights to the treatment works. Upon at least 50% of the units within a development being issued a certificate of use and occupancy , this amendment requires th e local government for the jurisdiction where the treatment works is or will be installed to require the developer to obtain and file a performance bond of 100% of the total replacement cost for the first two years that the treatment works is in operation . The operator must file a performance bond for 50% of the replacement cost for th e third through tenth years that the treatment works is in operation. The full text of this amendment requires that decentralized wastewater systems using land application comply with applicable laws and environmental regulations, and establishes criteria for transfer, issuance, and modification of permits.