Cities, Quadvest, other utilities lead fight for freedom, as Texas Supreme Court takes San Jacinto River Authority venue case

Cities, Quadvest, other utilities lead fight for freedom, as Texas Supreme Court takes San Jacinto River Authority venue case

Image: Quadvest President Simon Sequeira, most obviously the Bob Marley of Montgomery County’s fight for freedom from the San Jacinto River Authority’s monopolistic water prices as well as The Golden Hammer’s Power Top Ten #8 in 2018, has much reason to celebrate, as the Texas Supreme Court has agreed to hear the mandamus petition of the City of Conroe, Quadvest, and others in their fight to set aside the onerous monopolistic water purchase contracts which the San Jacinto River Authority has forced down the citizens’ throats. Just as Marley fought for the unity of African people worldwide, Sequeira has led the fight for the unity of Montgomery County property owners and water users against the SJRA’s oppression.

Conroe and All of Montgomery County, March 31 – Simon Sequeira, President of Quadvest Water and Sewer Utility, who is also the President of Restore Affordable Water and the leader of the Pan-Montgomery County Water Property Rights Movement, which has fought the imperialism and monopolistic practices of the San Jacinto River Authority (SJRA), gleefully announced late Friday night that the Supreme Court of Texas has agreed to hear their request for a change of venue from Travis County (Austin) to Montgomery County in SJRA’s lawsuit against the Cities of Conroe, Magnolia, and Splendora, and against several water utility companies, including Quadvest among others. The Supreme Court issued an order on Friday, March 29, 2019, setting a briefing schedule for all of the parties.

After the at-the-time SJRA-controlled Lone Star Groundwater Conservation District (LSGCD) forced the cities and utility companies, who produced large amounts of groundwater to provide to water users, into onerous long-term contracts with SJRA to pay SJRA substantial fees in order to use their own groundwater or to purchase surface water from SJRA, the City of Conroe and the others had to enter into long-term contracts with SJRA in the 2010 time frame. Those contracts contained a provision in them, however, which SJRA had stipulated that “venue [for any dispute] shall be in a court of competent jurisdiction located in Montgomery County.”

Under those contracts, the parties forced to contract with SJRA were paying millions of dollars in overcharges for surface water or surcharges, while they could not utilize their own privately-owned groundwater resources freely as a result of the hyper regulation of LSGCD.

In the Supreme Court petition, the City of Conroe explained:

“The parties’ Contracts describe a project within Montgomery County for which SJRA would construct, manage, and operate a surface water treatment plant on Lake Conroe and a pipeline system to deliver treated water to The Woodlands and Conroe…To finance the project, SJRA issued revenue bonds, which created indebtedness of approximately $500 million…

“SJRA’s revenues from the Contracts derive from two sources: (1) a ‘pumpage fee’ payable to SJRA by parties to the Contracts for all groundwater they produce, and (2) the price for treated Lake Conroe water that SJRA sells to certain parties on SJRA’s pipeline, principally Conroe and The Woodlands…The Contracts contain extensive provisions stating how pumpage fees and lake water prices may be set, including that they must be “just, reasonable, and nondiscriminatory,” and that they ‘shall be at all times the lowest which are . . . consistent with good management practices by [SJRA]…’

“The provisions of the Contracts that regulate SJRA’s fees and prices are the only protection parties to those contracts have from excessive fees and prices charged by SJRA. SJRA’s only authority to charge pumpage fees and prices for lake water is the Contracts. No regulatory authority (such as the Public Utility Commission) protects Relators or their residents and customers from SJRA’s fees or prices.

“The Contracts provide for SJRA’s Board of Directors to set pumpage fees and prices for lake water by issuing ‘Rate Orders….’ Rate Orders sound like orders issued under governmental authority, but in this case they are not. SJRA’s only authority to issue unilateral Rate Orders derives from the parties’ Contracts. Those Contracts define ‘Rate Order’ as ‘the prevailing order or resolution duly adopted by the Board of Directors of the Authority, to the extent not contrary to, inconsistent with, or prohibited by the terms and provisions of this contract . . ..’

“In the years after the Contracts were signed, SJRA regularly issued new Rate Orders escalating its fees and prices. In June 2016, SJRA issued a new Rate Order…that once again substantially increased its pumpage fees and prices effective September 1, 2017.

“Dismayed by SJRA’s spending and accounting practices, and after exhausting informal efforts to have SJRA delay implementation of its FY2017 Rate Order, Conroe’s City Council passed a resolution calling upon SJRA to suspend its FY2017 rate increase…The resolution instructed Conroe’s city staff to continue to pay SJRA’s fees and prices then in effect, but not to pay the incremental increases scheduled to take effect September 1st. Magnolia’s City Council adopted a similar resolution.

“SJRA responded to the Cities’ resolutions by filing the underlying lawsuit in Travis County… SJRA pleaded that venue is proper in Travis County [under a statute SJRA claimed protected SJRA which permitted lawsuits in Travis County.]”

Fundamentally, even though SJRA had placed in its own contracts with 80 contracting parties that venue would only be proper in Montgomery County, Texas, SJRA brought the lawsuit to enforce the contracts against those parties in Travis County. SJRA clearly didn’t want to have to face a jury of Montgomery County residents who suffer its imperialistic and monopolistic actions.

In the mandamus petition to the Supreme Court of Texas, the Cities of Conroe, Splendora, and Magnolia, Quadvest, and several other contracting parties involved in the litigation, which SJRA brought against them to try to enforce monopolistic water pricing, have asked the Supreme Court to transfer the venue of the lawsuit to Montgomery County. Judge Stephen Yelenosky, the 98th District Judge of Travis County, and the Austin Court of Appeals denied their request to transfer venue. In fact, the Court of Appeals refused even to consider the case.

In the case, the cities and utility companies must file their briefs on April 29, while SJRA must file its responsive brief on May 24. It is unclear whether the Supreme Court will allow oral argument rather than considering the case based entirely upon the briefing. In mandamus cases of this nature, oral arguments are somewhat rare.

LSGCD’s Board of Directors is now quite different from the past, as the Texas Legislature changed its Board to an entirely elected Board. Voters elected a pro-property rights Board of seven Directors on November 6, 2018.

Webb Melder, the former Conroe Mayor who is now President of LSGCD’s Board and a fierce water rights advocate, has previously said, “SJRA thought they were untouchable, but the Supreme Court of Texas has said ‘nope.'”

LSGCD’s entire attitude towards the citizens has dramatically changed. Recent communications between LSGCD’s Interim General Manager Samantha Reiter and this newspaper have shown clearly that LSGCD has adopted a pro-citizen attitude in which the Board and the staff seek to comply with Texas law rather than the monopolistic and imperialistic whims of SJRA and its General Manager Jace Houston, who used to control LSGCD’s policymaking to force groundwater users to purchase surface water from SJRA instead.

As leader of the Pan-Montgomery County Water Property Rights Movement, Quadvest’s and RAW’s Sequeira is demonstrating the reality of sage philosopher Bob Marley when he said, “It is better to die fighting for freedom than be a prisoner all the days of your life.”

Is Bob Marley really the inspiration for the work of Simon Sequeira, Duane Ham, Bill O’Sullivan, and Mike Stoecker in the Pan-Montgomery County Water Property Rights Movement?





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