Relating to the authority of the Texas Water Development Board to provide financial assistance from the economically distressed areas account that is not required to be repaid.

HB 365 amends the Texas Water Code to increase the maximum amount of non-repayable financial assistance the Texas Water Development Board (TWDB) can provide to local governments in economically distressed areas. The bill raises the cap from 70% to 90% of the total principal amount of state-issued bonds (plus outstanding interest) authorized for water development projects under Article III of the Texas Constitution. This change allows the TWDB to grant more funding without requiring repayment, potentially expanding support for water infrastructure in struggling communities. The bill takes effect on September 1, 2025.