Relating to late payment fees charged by a municipally owned water utility.

This bill limits late payment fees charged by municipal water utilities in Texas. It caps fees at $5 or 2% of the overdue amount before day 32, $5 or 5% between days 32-41, and $5 or 10% after day 41. Utilities cannot begin charging penalties before 21 days after billing a customer, and penalties end when the full amount is paid. The rules apply only to fees charged on or after the bill's effective date (September 1, 2025, unless passed by two-thirds vote).