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House Bill 1437, passed by the Texas Legislature in 1999, authorizes LCRA to transfer up to 25,000 acre-feet of water per year to Williamson County under certain conditions. The bill requires an additional charge to be added to the base water rate to pay the costs of mitigating any adverse effects of the transfer of water to Williamson County from the lower Colorado River watershed. This water transfer also should result in "no net loss" of water to the Colorado River watershed.

Water resources developed or conserved to mitigate the water transfer may be acquired from inside or outside of the Colorado River watershed and shall be used to benefit the water services areas of the LCRA's irrigation operations.

The LCRA has contracted with The University of Texas LBJ School of Public Affairs to recommend a definition of the term "no net loss," and assist in the development of a water replacement strategy, and a surcharge rate for the transfer of water from the lower Colorado River basin to Williamson County. LBJ School's recommendations will be based on public comments and advice provided through two sets of public meetings. The LCRA's Board of Directors will ultimately decide on the definition of no net loss, the appropriate mitigation strategy and final water surcharge rate.