Sec. 11.146.  FORFEITURES AND CANCELLATION OF PERMIT FOR INACTION.  (a)  If a permittee fails to begin construction within the time specified in Section 11.145 of this code, he forfeits all rights to the permit, subject to notice and hearing as prescribed by this section.
(b)  After beginning construction if the appropriator fails to work diligently and continuously to the completion of the work, the appropriation is subject to cancellation in whole or part, subject to notice and hearing as prescribed by this section.
(c)  If the commission believes that an appropriation or permit should be declared forfeited under this section or any other sections of this code, it should give the appropriator or permittee 30 days notice and provide him with an opportunity to be heard.
(d)  After the hearing, the commission by entering an order of record may cancel the appropriation in whole or part.  The commission shall immediately transmit a certified copy of the cancellation order by certified mail to the county clerk of the county in which the permit is recorded.  The county clerk shall record the cancellation order.
(e)  Except as provided by Section 11.1381 of this code, if a permit has been issued for the use of water, the water is not subject to a new appropriation until the permit has been cancelled in whole or part as provided by this section.
(f)  Except as provided by Subchapter E of this chapter, none of the provisions of this code may be construed as intended to impair, cause, or authorize or may impair, cause, or authorize the forfeiture of any rights acquired by any declaration of appropriation or by any permit if the appropriator has begun or begins the work and development contemplated by his declaration of appropriation or permit within the time provided by the law under which the declaration of appropriation was made or the permit was granted and has prosecuted or continues to prosecute it with all reasonable diligence toward completion.
(g)  This section does not apply to a permit for construction of a reservoir designed for the storage of more than 50,000 acre-feet of water.
Amended by Acts 1977, 65th Leg., p. 2207, ch. 870, Sec. 1, eff. Sept. 1, 1977;  Acts 1987, 70th Leg., ch. 405, Sec. 2, eff. Sept. 1, 1987;  Acts 2001, 77th Leg., ch. 966, Sec. 2.10, eff. Sept. 1, 2001.