After Time in Court and Council, Still Questions in AMWA-Athens dispute

(BACKGROUND: In December, the AMWA filed a lawsuit against the city alleging the City is in breach of contract, breach of fiduciary duty, is negligent and has committed fraud. The City answered back later in the month by beginning the process of dissolving the AMWA. The issue boils down to who should pay for the operation and maintenance of Lake Athens, the dam, and the water treatment and transportation facilities. Click here to read more.)

By Michael V. Hannigan
Henderson County Now

There was a lot of action today in the dispute between the Athens Municipal Water Authority (AMWA) and the City of Athens.

Visiting Judge Joe Clayton presided over the first hearing on the case in 173rd District Court today and issued his first ruling, which was in favor of the AMWA. Later, the City of Athens held its regular City Council meeting during which council members unanimously voted to dissolve the AMWA.

There was also an appeal filed and a petition filed. And accusations batted back and forth like a ping pong ball.

Here is the important thing to know. Nothing definitive happened today.

Yes, the AMWA won the first point in the courtroom, but the City was still able to sidestep the restraining order the water authority requested and now there’s an appeal before the 12th Court of Appeals in Tyler.

And yes, the City did vote to dissolve the AMWA. But the water authority says it has enough signatures on a petition to push the issue before the voters.

So on the questions of whether the AMWA will continue to exist and whether the lawsuit it filed has any merit, we don’t know yet.

What we do know is that the action has forked into two separate paths at this point: the judicial (court) and the governmental (council).

JUDICIAL

Today, attorneys from the AMWA and the City stood in front of Judge Joe Clayton for the first time in the 173rd District Court. Although onlookers were most interested in the AMWA’s request for a temporary restraining order — which would have stopped the City Council from voting to dissolve the water authority Monday night — the court dealt with another issue first.

For more than an hour, attorneys from both sides debated whether the AMWA had the right to sue the City on the particular issues cited.

While I work for an attorney I am not one myself, so I won’t even try and reproduce the legal arguments here. But Judge Clayton agreed with the AMWA on all points.

Before the hearing could move on to the restraining order, however, the City’s attorneys filed an appeal to the judge’s decision. Because this particular decision was a key to the case moving forward — called a “threshold” decision — the hearing was automatically stopped until after the appeal is heard in the 12th Court of Appeals in Tyler.

Because of the appeal, Judge Clayton never got to rule on the temporary restraining order.

The lawsuit is now on hold until after the appeal. If Judge Clayton’s ruling is upheld, the case would come back to 173rd District Court and get picked back up. If the appeal is approved and Judge Clayton’s ruling is shot down, then the lawsuit cannot go forward. But if that happens, it seems likely the AMWA would appeal that ruling.

Either way, more legal wrangling and court appearances are on the horizon for the AMWA and the City.

GOVERNMENTAL

The Athens City Council unanimously approved the second reading of an ordinance to dissolve the AMWA at its regular meeting Monday night. With the ordinance, the City abolished the water authority in accordance with Texas state law.

But that wasn’t the end.

The same Texas state law (Local Government Code 43.074) also provides water authorities with a way to defend themselves from being abolished, and AMWA took advantage.

According to the law, if the water authority can collect the signature of qualified voters “equal to at least 10 percent of the total votes cast at the most recent election for municipal officers…” then the city has to either repeal the ordinance or “submit it to a popular vote at the next municipal election…”

According to AMWA attorneys, the number of signatures needed to reach the 10 percent requirement is 124 and they say they have 374 signatures.

With the petition now presented, the City must verify the signatures and if there are enough to meet the requirements, then it must either reinstate the AMWA or put the issue before the voters of the city.

There is another factor in play for the City. At both the court hearing and at the City Council meeting, AMWA attorneys said the City was violating the Texas Open Meetings Act by the way the agenda items are worded.

On Monday night’s agenda, the item regarding the water authority read: “Consider second and final reading of an Ordinance to dissolve the Athens Municipal Water Authority….”

AMWA attorneys argue that the word “consider” does not allow the City Council to actually take action and vote. AMWA attorney Martin Bennett even stopped the council meeting Monday night to make the point.

Council members were advised by their attorney that the wording was fine and the council went ahead and voted.