Relating to limitations on the issuance of bonds by the Texas Water Development Board for the development of certain projects in economically distressed areas.

HB 422 reduces the annual bond limit for water projects in Texas economically distressed areas from $100 million to $25 million. It directly affects water supply and sewer projects in these areas by limiting the Texas Water Development Board's ability to issue bonds for such initiatives. The key provision amends the Water Code to cap dedicated bonds under Section 17.0111 at $25 million annually, while maintaining a separate $50 million cap for other bond types. This change restricts funding availability for infrastructure development in underserved communities. The bill takes effect September 1, 2025.