This subchapter applies only to a municipality:
(1) that has a population of more than 275,000;
(2) in which a majority of the qualified voters voting in an election have voted to authorize the municipality to contract with a river authority created under Section 59, Article XVI, Texas Constitution, to acquire a water supply project from that authority; and
(3) that holds a permit issued by the Texas Commission on Environmental Quality for the municipality to use the water supply.