Skip to main content

Why Water Infrastructure is Key to Economic Growth and Competitiveness

Published Jan 09, 2025 by Jordan Overturf

water infrastructure

Following the success of the Texas Water Fund initiative in the 88th Texas Legislative Session, voters overwhelmingly supported the constitutional amendment to fund $1 billion in water infrastructure solutions. With lawmakers set to convene in January, the Partnership sat down with state leaders to explore key updates and insights ahead of the 89th Legislative Session. Here are six essential questions you need to know about water policy.  

For those who don’t know much about Texas water systems, what is a high-level overview of how it works? Specifically, who owns the water in Texas and who controls water regulations? 

In Texas, the general rule is that any water on the surface belongs to the government, and water below the surface belongs to the property owner. As for who regulates water, there are three main state agencies in play: 

  • Public Utility Commission (PUC): The PUC oversees general regulations regarding utilities, with help from ... 
  • Texas Commission on Environmental Quality (TCEQ) oversees the regulation and enforcement of water quality throughout the state. This includes reviewing reports on poor drinking water and other concerns from the general public. 
  • Texas Water Development Board (TWDB) manages various funds for water infrastructure, including the state’s overall water plan.  

In addition to these state agencies, regional and local entities oversee water resources. These include the river authorities and groundwater conservation districts, which provide local water-use regulations and water table management.  

What are the current challenges facing Houston's water infrastructure, and how do they affect local businesses and residents? 

Houston is facing two major challenges related to water resources: fast growth and aging infrastructure. For decades, limited resources have prevented the city from adequately investing in its water infrastructure. This long period of deferred maintenance has left many projects needing funding to modernize or restore old systems. At the same time, as our region continues to grow, there is a need for additional systems to supply the water necessary for new homes and businesses. 

With 274 industry and utility connections, the City of Houston supplies substantial water to the region. An emergency interruption would be detrimental and could hinder businesses and slow regional growth in the long term. Investing the necessary dollars to address growth and strengthen existing systems will ensure our economic engine remains strong throughout Greater Houston.

How does reliable water infrastructure foster economic growth and competitiveness for Texas and Houston? 

Reliable infrastructure is critical to economic growth, ensuring businesses and people thrive. Texas will struggle to attract and retain investments without reliable and safe access to water.  

Texas is a beacon of opportunity for industry and people. As the state grows, so does the need for vital resources like water supply and water infrastructure. By prioritizing investments like the Texas Water Fund, we are making clear that our people and their future are a priority. It is not just an investment in water; it is an investment in quality of life. We are fostering opportunity by meeting these infrastructure needs and providing access to critical resources.  

For an economic engine like Houston, home to the world’s largest petrochemical complex and the Texas Medical Center – which receives untreated and treated water from the city - the stakes are incredibly high. As the energy capital, it is essential for Texas, not only the region, for Houston to continue to thrive – which could be jeopardized without increased investment in critical infrastructure.  

What legislative measures have been passed in previous sessions to address water infrastructure challenges in Texas, and how do you expect the legislature to expand on those efforts in the coming year?   

The Texas Water Fund, which received $1 billion contingent upon voter approval, was overwhelmingly passed by the 88th Legislature and approved by Texas voters in 2023, with nearly 78% supporting the ballot initiative. Lawmakers proposed restructuring the $1 billion within the Texas Water Fund to begin delivering solutions and driving innovation to bolster available resources.  

This session, securing a dedicated funding source — similar to the Texas Highway Fund — to support ongoing water infrastructure needs will lay the foundation for future investments. It will also give local governments a regular source for long-term planning projects. 

Additionally, an expanded focus will likely be on growing the workforce pipeline for the water treatment and delivery industries. This would be similar to pushes in recent years to increase the availability of skilled tradesmen and expand the energy corridor workforce. 

The Texas Senate Committee recently released a report with 20 legislative recommendations aimed at improving water infrastructure across the state. What are some recommendations that the Partnership may be taking a closer look at? 

Each of the recommendations is worthy of consideration and deep discussion by lawmakers in Austin. Some key recommendations from the report include: 

  • Establish a dedicated revenue stream for long-term water infrastructure development, including expanding available funding in the Texas Water Fund. 
  • Supporting the TRUE grant program and encouraging partnerships between water systems, licensing agencies, and technical colleges will put workforce expansion on the fast track. 
  • Modernizing case management at the Public Utility Council and establishing alternative legal classifications for treated produced water. 
  • Creating an emergency fund and expanding “safe harbor” provisions to help rehabilitate smaller, failing systems before a catastrophe strikes. 

Click here to read the full report and recommendations by the Senate Committee on Water, Agriculture, and Rural Affairs.

What role can the business community play in advocating for and supporting improvements to water infrastructure during the upcoming legislative session?  

The business community will have a vital role to play during the upcoming 89th Legislative Session in advocating for and supporting water infrastructure investment. By highlighting the critical connection between reliable water systems and economic growth, we can implore the Legislature to prioritize investments in water infrastructure and secure much-needed dollars to improve systems in our region. This collaboration will be key as we look ahead to the future. 

Learn more about the Partnership's Legislative Priorities, click here. For more updates and alerts on the Texas Legislature, click here to sign up for our weekly newsletter.

Related News

Public Policy

Constitutional Ballot Could Have Big Implications for Houston Region

7/10/25
This November, millions of Texas voters will head to the polls to decide whether to approve or reject 17 proposed constitutional amendments by state lawmakers. It’s an annual process that plays out in the fall during odd-numbered years following a legislative session.  This year, however, the potential benefits for the Houston area are greater based on two key funding proposals: $1 billion annually for water projects and $300 million annually for a newly created Dementia Prevention and Research Institute of Texas (DPRIT). Secretary of State Jane Nelson drew the order for the November 4 ballot last month, following the end of the veto period. As the state’s top election official, the Secretary of State oversees organizing the constitutional election. The propositions are drawn at random to determine the order in which they appear on the ballot. The two key propositions supported by the Partnership are as follows: Prop 4: "The constitutional amendment to dedicate a portion of the revenue derived from state sales and use taxes to the Texas water fund and to provide for the allocation and use of that revenue." Prop 14: "The constitutional amendment providing for the establishment of the Dementia Prevention and Research Institute of Texas, establishing the Dementia Prevention and Research Fund to provide money for research on and prevention and treatment of dementia, Alzheimer's disease, Parkinson's disease, and related disorders in this state, and transferring to that fund $3 billion from state general revenue." The language above is precisely what will be included on the ballot. However, there is much more to these propositions and the legislation passed into law that makes these initiatives possible. Click here to read more about the potential $20 billion investment in water. Click here to learn more about the potential impact $3 billion in total funding for DPRIT could have on Houston’s medical research community. Included in the additional 15 propositions are recommendations related to the creation of a dedicated fund to support skilled trade programs at Texas State Technical College, changing the state’s tax code, and providing a tax exemption to surviving spouses of fallen veterans in specific scenarios.  A complete list of the ballot order and prop language is available on the Secretary of State’s website.  
Read More
Public Policy

Show Houston the Money: Exploring the $338 Billion Texas Budget

7/10/25
This year, Texas lawmakers passed a historic spending bill that increased the two-year funding total by more than $27 billion over the previous budget. A portion of that spending was included in the Supplemental Budget (House Bill 500), providing immediate funding for targeted projects. The direct impact on the Houston area over the next two years is significant: $1.22 billion in new programmatic funding for 47 school districts around the Houston region $1.17 billion across local medical schools Nearly $362 million in dedicated funding for flood prevention & water supply projects $135 million for regional operational centers for the Texas Department of Emergency Management and other emergency operations $12.8 million for upgrades to the Harris County Psychiatric Hospital Click here for an infographic highlighting other policy victories for the state and the city of Houston. These targeted investments are enormous for the Houston region, but there is also much more on the horizon. On November 4, Texas voters will decide on 17 constitutional propositions, two of which could bring more funding to local communities, including: Prop 4: Authorizing the legislature to dedicate $1 billion annually to the Texas Water Fund over the next 20 years Prop 14: Authorizing the creation of a Dementia Prevention and Research Institute of Texas and providing $3 billion over the next 10 years Exploring the Budget The Partnership has updated its Budget Explorer Tool with the final version passed by lawmakers. Using this tool, you can explore topline funding by agency, specific funding for water and education programs, and search new funding projections for individual school districts. There is also a table of contents that links to appropriations for each agency.  Here’s a quick reminder on how to read the state budget: Method of Financing: From where does the money come (i.e., state, federal, or other)? Strategy Funding: The highlighted funding for specific programs and targeted goals for the agency Riders: This is the last section of the agency funding in the bill, and it gives specific instructions on how the dollars are to be spent. Article IX: This is where you will find additional provisions on spending and revenue, as well as contingency funding.  For more updates and alerts on the Texas Legislature, click here to sign up for our policy newsletter. 
Read More

Related Events

Membership

Future of Texas featuring District Attorney Sean Teare

We invite our members to an engaging conversation with Harris County District Attorney Sean Teare. Don’t miss this opportunity to hear firsthand about his vision, priorities, and the challenges shaping our local…

Learn More
Learn More
Executive Partners