1st District Court of Appeals holds section of Texas Water Code regarding sewer CCNs unconstitutional

City of Tyler v. Liberty Utilities (Tall Timbers Sewer) Corp., 01-17-00745-CV (Tex. App. – Houston [1st Dist.], December 20, 2018)

This is a declaratory judgment case where the First District Court of Appeals in Houston held a provision of the Texas Water Code unconstitutional.

Liberty Utilities (Tall Timbers Sewer) Corporation provides retail sewer utility service in Smith County under a certificate of convenience and public necessity. The City of Tyler desired to provide sewer service in Liberty’s service areas. State law prohibited the dual service in the area, so the City went to the Legislature, which passed §13.2475 of the Texas Water Code.  This created an exception from the generally applicable law allowing the City to provide sewer service within its boundaries, even in Liberty’s service areas. Liberty then sued the City, successfully obtaining a declaratory judgment that §13.2475 is unconstitutional. The City appealed.

In this 21-page opinion, the court analyzed the constitutional prohibition against local laws under  Article III, Section 56 of the Texas Constitution. The court analyzed the legislative debate and the author’s stated intended purpose. The court determined the section was bracketed and intended to address Tyler and regulated its affairs as a local law. The court further determined none of the constitutional exceptions from the prohibition applied. “The City of Tyler’s legislative strategy to uniquely exempt itself from the operation of Water Code Section 13.247(a) was a violation of the Texas Constitution’s default preference for laws of general applicability and general prohibition of local laws.”  As a result, it held §13.2475 unconstitutional.

If you would like to read this opinion click here. Panel consists of Justice Keyes, Justice Bland, Justice Massengale. Opinion by Justice Massengale.