Amends the Water Commission Act of 1985. Defines "territorial municipality." Provides that the chairperson of a water commission shall be a resident of the home county for chairperson appointments made after the effective date of the amendatory Act. Provides that, upon receipt of water by any territorial municipality, one commissioner from a territorial municipality shall be appointed by the chairperson of the county board of the home county with the advice and consent of the county board and one commissioner from a territorial municipality shall be appointed by the majority vote of the mayors of those territorial municipalities. Makes conforming changes.