1. (a) Notwithstanding any right or permit to use the water of the Colorado River and its tributaries for the generation of hydroelectric power that was issued by the former State Board of Water Engineers, was in existence as of May 2, 1935, and is acquired by the authority, the impounding and use of the floodwaters of the Colorado River and its tributaries for the generation of hydroelectric power by the authority or a person who succeeds to the rights and privileges conferred on the authority by this chapter are subject to the rights of any other person who before May 2, 1935, was impounding or as of that date was putting to beneficial use any water for the purposes described by Sections 11.024(1) and (2), Water Code, if the person:

   1. (1) before May 2, 1935, received a permit for that use from the former State Board of Water Engineers; or
   2. (2) by law was permitted before May 2, 1935, to impound water for those purposes.

2. (b) This chapter may not be construed to subject to condemnation by the authority or any successor of the authority, or by any person who succeeds to the rights and privileges conferred on the authority by this chapter, any water:

   1. (1) impounded or to be impounded inside or outside the authority under any law authorizing water to be impounded or under any permit granted to a municipal corporation or body politic; or
   2. (2) impounded or permitted to be impounded or used outside the authority under a permit granted to any person.
3. (c) This chapter may not be construed to deprive any person of the right to impound the water of the Colorado River or its tributaries for domestic or municipal purposes or to repeal any law granting such a right to a person.

4. (d) The rights of the authority to impound, use, or sell the water of the Colorado River and its tributaries for the generation of hydroelectric power are subordinate and inferior to the rights of:

   1. (1) municipalities situated in the watershed of the Colorado River and its tributaries to build dams and impound floodwaters for municipal purposes; and
   2. (2) any residents of this state or bodies politic to build dams and impound the floodwaters in the watershed of the Colorado River and its tributaries for domestic purposes and for the purposes of irrigation.
5. (e) The title to any right, property, license, franchise, or permit acquired by the authority is subject to the limitations imposed by Subsection (d).

Added by Acts 2015, 84th Leg., R.S., Ch. 855 (S.B. 1162), Sec. 1.05, eff. April 1, 2017.