DALLAS – A $2 billion bond program for water projects in drought-stricken Texas won nearly unanimous approval in the state House of Representatives with strong support expected in the Senate.

House Bill 4 establishes a State Water Implementation Fund of Texas, or SWIFT, to serve as a water infrastructure bank to boost financing resources the Texas Water Development Board, the state issuer of bonds for local water utilities.

In a vote of the full House on Wednesday, only two members voted against the measure, with 145 in favor. Rep. Van Taylor, R-Plano, and Rep. David Simpson, R-Longview, cast the only votes against the bill.

Lt. Gov. David Dewhurst, who presides over the Senate and makes committee appointments, voiced support for the SWIFT plan before the bill was introduced.

Another measure, House Bill 11, which would actually fund the program through the state rainy day fund, is still awaiting approval.

The TWDB carries ratings of AA-plus from Standard & Poor’s and triple-A from Moody’s Investors Service and Fitch Ratings, which lowers interest costs for local water utilities that then sell their bonds to the board.  Thus, bonds issued by the board are backed by revenues from the local issuer along with the state’s general obligation pledge.

The board issued $52 million of GO bonds in January.

Under H.B. 4, the TWDB would be authorized to issue revenue bonds backed by the SWIFT fund.

The state’s water plan, written in 2011 and released in 2012, reports that the state providing for the water needs of the growing population over the next 50 years will require more than $50 billion in state and local funding. Water utilities would need $26.9 billion in state assistance, according to the plan.

“Our projections show that $2 billion would fully implement the State Water Plan as it exists today,” said Rep. Allan Ritter, R-Nederland, author of H.B. 4. “With that one-time capital investment, we could provide adequate, meaningful funding to the plan and achieve the state’s goals of supporting local entities in the implementation of projects.”

In opposing H.B. 4, Taylor said he was seeking to preserve the state’s credit rating.

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