A judge ruled in favor of the city on all accounts — granting the city’s motion for summary judgment — in the stormwater lawsuit filed by John Beck, president of Beck Steel, Inc.
The lawsuit filed in August 2015 challenges the city of Lubbock for what Beck says is overcharging for stormwater drainage and transferring the funds for uses not authorized by the Texas Local Government Code. The lawsuit asked the court to require the city to refund ratepayers $15 million.
Arguments for the city’s motion for summary judgment were heard Dec. 7, where attorneys for Beck argued that under the Municipal Drainage Utility Systems Act, the city isn’t allowed to use drainage fees to pay for general obligation debt, which street maintenance projects fall under. According to Avalanche-Journal archives, the lawsuit also is contesting the city’s use of money from payment in lieu of franchise fees and payment in lieu of property tax to pay for the street maintenance project.
Deputy City Attorney Jeff Hartsell argued in court in December that Lubbock’s home-rule municipality state status allows it to charge drainage fees as it sees fit, unless expressly forbidden by the state Legislature. Hartsell said that even if the judge disagrees with the home-rule municipality argument, the use of stormwater funds for street maintenance is proper because streets in Lubbock are designed to carry stormwater runoff.
On Thursday, visiting Judge Paul Davis granted the city’s motion for summary judgment — a request for the court to rule that the other party doesn’t have a case.
Beck’s attorney Terry Salazar said his client is disappointed with Davis’ ruling and will appeal it to the Seventh Court of Appeals of Texas.
“This is the first step in a process,” Salazar said. “(Davis) made his ruling based upon legal issues that were presented to him, so now we will … appeal those legal issues to the court of appeals, and the court of appeals will take a fresh look at it.”
A statement from the city said, “The city of Lubbock is pleased with the ruling by the trial court and will continue to assert its legal positions if the plaintiff appeals.”
The new stormwater rates that kicked in at the beginning of 2015 are still in place. Those rates are based on impervious area rather than the number of meters on a property, and set a cap for the largest commercial properties at $690 a month. The revenue the city began collecting increased due to several large drainage projects.
In its motion for summary judgment, the city asserted that the use, charges and debt financing were proper in its stormwater rates. The city asserted, and the judge ultimately ruled in favor, that using stormwater fees to pay for partial street maintenance was proper since streets are a primary part of the city’s drainage system, and the assessment of franchise fees and payments in lieu of taxes were proper.