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Sunday, December 15, 2019

Exception allowing Tyler to provide sewer services unconstitutional, Texas appeals court rules


By Karen Kidd | Jan 2, 2019


HOUSTON – The city of Tyler will not be able to provide sewer services within its own limits based on an exception to the state's water code passed by the state legislature because that exception is unconstitutional, according to a recent Texas appeals court ruling.

In its 15-page opinion handed down Dec. 20, the Texas 1st District Court of Appeals affirmed an earlier trial court's ruling about the exceptions constitutionality.

"We conclude that the statute in controversy violates the general constitutional prohibition against local laws that regulate the affairs of a city," Justice Michael Massengale wrote in the opinion. "We furthermore conclude that the constitutional provisions that generally authorize legislative control over privileges and franchises and that generally prohibit perpetuities and monopolies did not authorize this local law."

Justice Evelyn Keyes and Justice Jane Bland concurred with Massengale's opinion.

The Texas Supreme Court earlier transferred the appeal to the 3rd District under its docket equalization authority.

The case is the latest in a long-standing dispute between the city of Tyler and Liberty Utilities, also called Tall Timbers Sewer. Liberty Utilities provides retail sewer utility services in Smith County. The case stems from the city of Tyler's wish to provide sewer services within its limits and which the state legislature attempted to make possible by adding a new section to the state's water code, according to the background portion of the Appeals Court's opinion.

The section created an exception in the code to allow Tyler to provide sewer service within its boundaries, even in annexed areas where Liberty Utilities already provides services. No parties in the case dispute that the exception to the state's water code applied only to the city of Tyler.

Liberty Utilities sued the city, claiming the exception violates Article III, Section 56 of the state's constitution, which prohibits local or special laws. Travis County 98th District Court agreed and granted Liberty Utilities a declaratory judgment that the exception provided by the state legislature is unconstitutional.

The city of Tyler appealed, arguing the exception did not violate Article III, Section 56 and that other portions of the state's constitution, Article I, Sections 17(d) and 26, do provide for exceptions to otherwise constitutionally prohibited local laws.

The Appeals Court rejected the city's argument.

"The city argues that Article I, Section 17(d) provides that the privileges and franchises granted by the Legislature are 'subject to the control thereof,' but it provides no argument why that cannot be done by general law, as has been done already in the water code," the opinion said. "The city argues that Article I, Section 26 prohibits perpetuities and monopolies, but it provides no argument why the statute in controversy in this appeal is a perpetuity or monopoly that should be prohibited by a local law and should not by the same logic be prohibited in all places by a general law."

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