Created as a fund in the state treasury administered by the Texas Water Development Board, held and invested by the Texas Treasury Safekeeping Trust Company.

The fund consists of transfers, appropriations, interest and investment earnings, gifts, grants, donations, and other money deposited to the fund as authorized by law. The fund may be used only to transfer money to other funds or accounts administered by the board.  Money transferred from the fund to another fund or account may be spent without legislative appropriation.

At least 25% of the amount initially appropriated to the fund, must be transferred to the Fund 0485 - New Water Supply for Texas. Other transfers may only be to:

• Fund 0480 - Water Assistance.
• Fund 0361 - State Water Implementation.
• Fund 0362 - State Water Implementation Revenue.
• Fund 0301 - Rural Water Assistance.
• GR Account 5200 - Statewide Water Public Awareness.
• Fund 0371 - Texas Water Development Fund II.
• State water pollution control revolving funds held outside of the state treasury.

A portion of the money transferred from the fund must be used for:

• Water infrastructure projects in municipalities with a population of less than 150,000 and rural political subdivisions.
• Projects for which all required state or federal permitting has been substantially completed.
• The statewide water public awareness program.
• Water conservation strategies.
• Water loss mitigation projects.