TCAA NEWS
(Volume 4, Issue 5 – May 2009)
“Your Source for Information About the Texas City Attorneys Association”
News and Updates

Eighty-First Legislative Session is Winding Down: Keep current by reviewing the weekly edition of the Texas Municipal League’s Legislative Update, which includes a short summary of most city-related legislation that is moving, as well as articles and other updates on items of interest. View the update at www.tml.org by clicking on “Legislative.”

Save the Date! The TCAA Fall Seminar in conjunction with the TML Annual Conference is tentatively scheduled for October 22, 2009, in Fort Worth. Special thanks to our fall sponsor:

  • Taylor, Olson, Adkins, Sralla, and Elam, L.L.P.

2009 TCAA Summer Conference – Register Now! Come join us for the best of both worlds: Earn MCLE credit while at the beach! The TCAA Summer Conference in South Padre Island will be held at the Isla Grand Beach Resort (formerly the Radisson Resort) on June 10-12, 2009. Attendees should remember that TCAA is “Going Green”! TCAA will no longer provide binders for speaker papers or printed materials of any kind. Instead, TCAA will put all speaker papers on the TCAA Web site under “speaker papers” for attendees to download in advance, if they so desire. No written materials (except for late speaker materials) will be provided at the seminar location. Special thanks to this year’s sponsors:

  • Abernathy, Roeder, Boyd & Joplin, P.C.
  • Banowsky & Levine, P.C.
  • Bickerstaff Heath Delgado Acosta, LLP
  • Brown & Hofmeister, L.L.P.
  • Davidson & Troilo, P.C.
  • Denton, Navarro, Rocha and Bernal, P.C.
  • Doyen Sebesta, LTD, LLP
  • FOIA Systems – Open Records
  • Hermansen, McKibben, Woolsey & Villareal, L.L.P.
  • LexisNexis
  • Lloyd, Gosselink, Rochelle & Townsend, P.C.
  • McKamie Law
  • Municipal Code Corporation
  • Nichols, Jackson, Dillard, Hager & Smith, L.L.P.
  • Olson & Olson, L.L.P.
  • Ross, Banks, May, Cron & Cavin, P.C.
  • Russell & Rodriguez, LLP
  • Strasburger & Price, L.L.P.
  • Taylor, Olson, Adkins, Sralla & Elam, L.L.P.
  • Texas Municipal League Intergovernmental Risk Pool
  • Thompson & Knight, LLP

To register for the conference or for more information, please go to www.texascityattorneys.org.

SPECIAL NOTE TO SUMMER CONFERENCE ATTENDEES – SCHLITTERBAHN DISCOUNT: TCAA has negotiated discount admission for attendees and their families to the Schlitterbahn water park on the island. The rate is $20 per person. If you are interested in purchasing tickets, please e-mail Scott Houston at shouston@tml.org with your name, contact information, and number of tickets.

Municipal Attorney Job Openings: For the most recent Texas Municipal League classifieds postings, please click here.

TML/TCAA Legal Defense Program
Amicus Brief, Attorney General Opinion, and State Agency Comments Filed

Vested Rights/Extraterritorial Authority: City of San Antonio v. Continental Homes of Texas, No. 08-0786, before the Supreme Court of Texas. TML and TCAA joined the City of Austin in arguing that: (1) regulations for the preservation of trees “promote the health, safety, morals, or general welfare of the municipality and the safe, orderly, and healthful development of the municipality” and a city may apply them in its extraterritorial jurisdiction pursuant to Chapter 212 of the Local Government Code; and (2) Chapter 245 of the Local Government Code does not allow a developer to ignore a city ordinance requirement to file an application simply because a different application covering the same land was filed before the city adopted the ordinance. The brief was filed on April 29, 2009.

Open Meetings Act: Avinash Rangra, Anna Monclova, and All Other Public Officials in Texas v. Frank D. Brown, 83rd Judicial District Attorney, Gregg Abbott, Texas Attorney General, and the State of Texas, C.A. No. 06-51587 in the United States Court of Appeals for the Fifth Circuit. On April 24, 2009, the U.S. Court of Appeals for the Fifth Circuit released its long-awaited opinion in this case. See a detailed article here.

Since the opinion was released, both the Texas attorney general and the city officials have filed for a motion for rehearing En Banc. The Texas attorney general has received amicus support from the Reporters Committee for Freedom of the Press and the attorneys general of 18 states. The Texas Municipal League, Texas City Attorneys Association, South Dakota Municipal League, Illinois Municipal League, National League of Cities, and International Municipal Lawyers Association filed an amicus brief in support of the city officials. The brief argues that the threat of imprisonment is not the least restrictive means of promoting open government.

Recent Texas Cases of Interest to Cities
Note: Included cases are from the period beginning on the 10th of the previous month through the 10th of the current month.

Governmental Immunity: City of El Paso v. Lilli Heinrich, No. 06-0778 (Tex. – May 1, 2009). Lilli Heinrich, widow of police officer Charles D. Heinrich, received monthly survivor benefits from the El Paso Firemen and Policemen's Pension Fund. In 2002, the city reduced the monthly payments to Heinrich by one-third because Heinrich's son turned 23. Heinrich filed this suit, alleging that the city and the individual board members violated the statute governing the fund by reducing her benefits retroactively. Heinrich sought both declaratory relief and an injunction restoring the full amount of the money owed. The city and individual board members filed pleas to the jurisdiction asserting that governmental immunity shielded the governmental entities from suit and that the individual board members enjoyed official immunity.

Governmental immunity protects cities from monetary damages, unless the immunity has been waived. Reata Constr. Corp. v. City of Dallas, 197 S.W. 3d 371 (Tex. 2006). However, individuals may seek declaratory judgment from governmental officials who “allegedly act without legal or statutory authority.” Tex. Nat. Res. Conservation Comm’n v. IT-Davy¸ 74 S.W.3d 849 (Tex. 2002). The Uniform Declaratory Judgment Act can be used by individuals to “settle and to afford relief from uncertainty and insecurity with respect to rights, status, and other legal relations.” TEX. CIV. PRAC. & REM. CODE § 37.002. This relief includes clarifying rights under city ordinance or contract. The Act cannot give parties access to relief they would not otherwise enjoy and does not expand a trial court’s jurisdiction. IT-Davy, 74 S.W.3d at 855. A suit for contract damages is allowed against a governmental entity where a law requires that government contracts be enforced in a certain way, without discretion. State v. Epperson, 42 S.W.2d 228 (Tex. 1931).

The Supreme Court held that Heinrich could bring a suit for prospective relief against the city officials, in their official capacities, who govern her claims for future benefits, because the officers allegedly acted outside their discretion under law in changing her benefits. The Court dismissed Heinrich’s retrospective claims and her claims against the city, the board, and the fund and sent the case back to the trial court.

Sovereign Immunity—Tort: City of San Antonio v. Charles and Tracy Pollock, No. 01-1118 (Tex. – May 1, 2009). From 1992 until 1998, Charles and Tracy Pollock lived in a house that backed up to a limestone quarry the City of San Antonio had used as a waste disposal site from 1967 to 1972. In 1994, the Pollock’s daughter, Sarah, was born. Sarah was diagnosed with acute lymphoblastic leukemia in 1998. A city report indicated the presence of the carcinogen benzene at the landfill. Because of that, the Pollocks moved out of the house and sued the city, claiming that Sarah’s leukemia was caused by Tracy Pollock’s exposure to benzene during her pregnancy from the waste disposal site.

The Pollocks relied heavily on expert testimony at trial to establish that the city was negligent in not taking steps towards remedying the situation. The Pollocks put forth Dan Kraft, an engineer with landfill management experience, to testify that in his opinion gas with a high concentration of benzene entered the Pollocks’ home on a regular basis. Sarah’s oncologist, Dr. Mahendar Patel, testified that in his opinion Sarah’s leukemia was caused by Tracy’s exposure to benzene during her pregnancy. Ultimately, the jury found that the landfill was a nuisance, the city was negligent, and the city acted with malice. The jury determined that the actual damages caused by the nuisance and negligence were: (1) $7 million for Sarah’s past and future physical pain and mental anguish; (2) $111,000 for past medical care; (3) $6 million for future medical care; (4) $29,000 in property damage caused by the nuisance; and (5) $10 million in exemplary damages assessed against the city. On appeal, the exemplary damage award was reversed, and the other damages were affirmed. The city appealed to the Supreme Court of Texas.

In the Supreme Court, the Pollocks relied on the expert testimony of Kraft and Patel to support the notion that Sarah’s leukemia was caused by the in utero exposure to benzene from the adjacent landfill. The city contended, as it had throughout the trial, that the expert testimony was conclusory and therefore legally insufficient to support a judgment. While the city did not challenge the reliability of the testimony, and did not necessarily disagree with the methodology, the city argued that there was no basis in the record for the expert’s opinions.

Examining the testimony of Mr. Kraft, the Court concluded that his opinion was a “naked conclusion” that could not support the judgment. Kraft based his opinion on data analyzing the gas inside a nearby monitoring well, ultimately concluding that the high concentration of benzene within the well indicated that the Tracy Pollock was chronically exposed to high benzene concentrations at her home. The Court held that the evidence only showed benzene concentrations within the well, and that the benzene undoubtedly dissipated in the ambient air. Thus, Kraft’s opinion that Tracy Pollock was exposed to high benzene concentrations had no basis in the record.

Dr. Patel relied on studies showing chromosomal anomalies at much higher concentration levels of benzene than the Pollocks were exposed to in order to support his opinion that the benzene levels at the landfill caused Sarah’s leukemia. He also noted that while some of Sarah’s chromosomal anomalies were found with exposure to benzene, others were unrelated to benzene exposure. The Court held that because neither the studies Dr. Patel relied on, nor the similarities in Sarah’s chromosomal anomalies, supported the opinion.

Finally, the Court concluded that the city was immune from the Pollock’s property damage claims because it did not act intentionally. In a previous opinion, the Court held that “mere negligence which eventually contributes to the destruction of property is not a taking.” City of Tyler v. Likes, 962 S.W.2d 489, 504-505 (Tex. 1997). Here, the Court determined that there was no evidence that the city knew that property damage was a necessary consequence of their management of the landfill, and the city’s awareness of the possibility of damage was not evidence of intent. With no evidence of a compensable taking, the city was held to be immune from the Pollock’s property damage claims. The Court reversed the judgment of the court of appeals, and rendered judgment that the Pollocks take nothing on their claims.

Franchise: Howard Adams v. City of Weslaco, No. 13-06-00697-CV (Tex. App. Corpus Christi-Edinburg – April 23, 2009) (mem. op.). In this case, South Texas Wastewater (STW), a provider of grease trap cleaning and disposal services to five restaurants in the city of Weslaco (“the city”) sued the city and the company to which the city granted an exclusive solid waste franchise. In 2005, the city granted an exclusive franchise for solid waste to Liquid Environmental Solutions of Texas (LES) and provided for civil and criminal penalties for companies that used any other solid waste company for the collection and disposal of grease. The city’s exclusive franchise agreement with LES prohibited STW from continuing its existing business in the city. The five restaurants already doing business with STW filed written documentation of their existing contracts and asked to be exempted from the exclusive franchise for the purposes of grease trap cleaning and disposal. The city refused. STW sued the city, claiming that: (1) the city did not have authority to grant an exclusive franchise to collect grease and grit; and (2) STW had a property right in its existing business and was damaged by the city’s actions. The city argued that it could have an exclusive franchise ordinance under state law and that there was no taking of property.

Texas Health & Safety Code Section 364.034, as amended in 2007, provides that: (1) nothing limits the authority of a city to enforce its grant of a franchise or contract for solid waste collection and transportation services within its territory; (2) the governing body of a city may provide that a franchise it grants or a contract it enters into for solid waste collection and transportation services supersedes inside of the city's boundaries any other franchise granted or contract; but that (3) a city, may not restrict the right of an entity to contract with a licensed waste hauler for the collection and removal of domestic septage or of grease trap waste or grit trap waste. The takings clause prohibits governmental entities from taking a person's property under its sovereign powers without adequate compensation unless by such person's consent. TEX. CONST. art. 1, § 17. To establish a takings claim, a property owner must prove that a city intentionally took or damaged property for a public use. A regulatory action is compensable without factual inquiry when a regulation deprives the owner of all economically beneficial or productive use of the property. Sheffield Dev. Co. v. City of Glenn Heights, 140 S.W.3d 660 (Tex. 2004).

The court held that, read as a whole, Texas Health & Safety Code Section 364.034 permits an opt-out from a city’s exclusive solid waste franchise for grease or grit traps and still allows for the enforcement of a duly authorized and legally granted franchise (which, by definition, may not disallow an opt-out). The court also held that STW had presented sufficient evidence of a taking, since the economic impact on STW of shutting down its business in the city is enough to abrogate the rights of STW, and the city’s ordinance is not a legitimate use of the city’s police power. The court reversed and remanded on the trial court’s grant of the city’s motion for summary judgment.

Deregulation: Cities of Dickinson, Friendswood, La Marque, League City, Lewisville and Texas City v. Public Utility Comm’sn, No. 03-08-00492-CV (Tex. App. Austin – May 1, 2009). Because: (1) the PUC had not explicitly addressed the cost of debt; and (2) the cost of debt could not be determined from cost of capital, the cost of debt must be determined from the company’s most recent earnings report. In this case, the PUC correctly determined the cost of debt.

Mobile Homes: Laura Parker v. City of Canadian, No. 07-08-0197-CV (Tex. App. Amarillo – April 29, 2009) (mem. op.). Texas Occupations Code Section 1201.008 is meant to be applied prospectively to mobile homes.

Takings: City of Borger v. Victor Garcia, No. 07-08-0444-CV (Tex. App. Amarillo – April 23, 2009). Evidence of negligence in designing and constructing a public work is insufficient to allege a taking because: (1) the design of a street drainage system is a discretionary act for which governmental immunity is not been waived, and (2) the particular design and construction of the drainage system selected by the City is within the City's discretion and may not be reviewed and revised by the courts in a piecemeal fashion. Since the plaintiffs presented no evidence of intentional acts by the city, the city’s plea to the jurisdiction was granted.

Attorney General Opinions of Interest to Cities
Note: Included opinions are from the period beginning on the 10th of the previous month through the 10th of the current month.

Opinion No. GA-0710 (Fire Hydrants): concludes that under Health & Safety Code section 341.0357, an owner is not required to first determine that the flow of a device having the appearance of a fire hydrant is less than 250 gallons per minute in order to paint the device black, if the owner determines that the device is otherwise unavailable for use by an entity providing fire suppression services in a fire emergency. Additionally, if the owner determines that all devices within a system are otherwise unavailable for use for fire suppression services other than on a temporary basis, an owner is required to paint all the devices black under section 341.0357 even when the flow from certain of those devices exceeds 250 gallons per minute.

You can view attorney general opinions at www.oag.state.tx.us. On the same site, you can also sign up to receive e-mail updates of opinion requests and newly released opinions.

As a supplement to TCAA News, please check the TML Legislative Update Newsletter and TML’s Connect News Service .
Please contact Scott Houston, TCAA General Counsel, with your news, questions, and/or comments by e-mail at legalgovt@tml.org or by phone at 512-231-7400.
TCAA members may use the information herein for any purpose. No other person may reproduce, duplicate, or distribute any part of this document without the written authorization of the Texas City Attorneys Association.
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