Jones v. City of Palestine ( 2008 )

IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
January 16, 2008
No. 07-40465 Charles R. Fulbruge III
Summary Calendar Clerk
L D JONES
Plaintiff-Appellant
v.
CITY OF PALESTINE
Defendant-Appellee
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 6:06-CV-299
Before KING, DAVIS and CLEMENT, Circuit Judges.
PER CURIAM:*
Plaintiff-Appellant L. D. Jones (“Jones”), on behalf of a putative class of
similarly situated individuals, brought this action to challenge the fee charged
by Defendant-Appellee City of Palestine, Texas (“the City”) for residential
wastewater between September 12, 1994 and October 1, 2005. Jones alleged
that the City passed an ordinance that clearly established a flat-rate charge.
The City, however, argued that the ordinance was ambiguous and that extrinsic
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
No. 07-40465
evidence revealed a legislative intent to establish a volume-rate charge. The
district court agreed with the City and granted summary judgment in its favor.
We AFFIRM.
I. FACTS AND PROCEEDINGS1
The City, a home-rule municipality organized under the laws of State of
Texas, provides water and wastewater services to its residents at rates
promulgated by ordinance. Jones, a resident of the City, is a water and
wastewater customer. Wastewater is billed separately from water. With regard
to water rates, the ordinance provides varying rates depending upon connection
size for the first 2000 gallons and a rate of $2.12 “after 2,000 gallons, per 1,000.”
PALESTINE, TEX., CODE OF ORDINANCES § 98.90. For residential wastewater
charges, the ordinance states:
(1) Residential. Residential users shall pay the charge according to
the following:
a. First 2,000 gallons, minimum charge $12.00
b. Over 2,000 gallons $3.40
The rate charged for residential wastewater service during summer
months will be based on the average of December-March, if actual
consumption is less, the consumer will be charged the actual charge.
Id. § 98.91(1).2 When the City established these wastewater rates on
September 12, 1994, it also adopted a “Customer Service Policy” resolution,
which stated that the $3.40 charge for wastewater over 2000 gallons would be
1
The parties agree that there is no factual dispute.
2
Ordinance No. 0-26-94, which was passed on September 12, 1994, is the original
ordinance for this section and was codified in this section. The City, however, also passed a
series of subsequent ordinances, which contained the same language for § 98.91(1), but
modified other subsections. These subsequent ordinances referred to by Jones include:
Ordinance No. 0-27-96, adopted on October 14, 1996; Ordinance No. 0-24-98, adopted on
September 28, 1998; Ordinance No. 0-23-02, adopted on October 23, 2002; and Ordinance No.
0-36-03, adopted on November 24, 2003.
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No. 07-40465
charged “per thousand.” Likewise, the City’s budget for 1996-97 expressly
provided that the $3.40 charge for wastewater over 2000 gallons was calculated
per thousand, and subsequent budgets used this volume rate for revenue
projections. On September 1, 2005, the City amended the ordinance, effective
October 1, 2005, to state “[f]irst 3,000 gallons, minimum charge . . . 12.00 base
charge” and “[o]ver 3,000 gallons . . . 3.40 per 1,000.”
On June 15, 2006, Jones filed this action in the 3rd Judicial District Court
in Anderson County, Texas, which the City removed to federal district court on
July 5, 2006 based on federal question jurisdiction.3 Jones primarily challenges
the fee charged to residents by the City for wastewater between September 12,
1994 and October 1, 2005. On August 18, 2006, Jones moved for partial
summary judgment. On September 29, 2006, the City also moved for summary
judgment. The parties filed the appropriate responses and replies. On
January 31, 2007, the district court denied Jones’s motion, granted the City’s
motion, and entered final judgment in favor of the City. Jones appeals.
II. STANDARD OF REVIEW
“We review a district court’s grant of summary judgment de novo.” N.W.
Enters. Inc. v. City of Houston, 352 F.3d 162, 172 (5th Cir. 2003). We also review
questions of statutory interpretation de novo. See Rogers v. City of San Antonio,
392 F.3d 758, 761 (5th Cir. 2004).
III. DISCUSSION
This appeal turns on the interpretation of the City’s residential
wastewater ordinance. See PALESTINE, TEX., CODE OF ORDINANCES § 98.91(1).
Jones argues that the plain language of the ordinance established a flat rate,
which by its terms capped monthly charges at $15.40 per customer ($12.00 for
the first 2000 gallons and $3.40 for any amount over 2000 gallons). Based on
3
In his First Amended Original Petition, Jones asserted a takings claim under the
United States Constitution, which served as the City’s basis for removal.
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No. 07-40465
this language, Jones alleges that the City unlawfully charged residents by a
volume rate ($12.00 for the first 2000 gallons and $3.40 per thousand for any
amount over 2000 gallons). Jones argues that if the City wanted to charge a
volume rate for residential wastewater over 2000 gallons, it could have explicitly
stated so in the ordinance by adding “per thousand” after “$3.40.” The City
counters that it inadvertently omitted the “per thousand” language from § 98-
91(1) and rejects Jones’s proposed interpretation, arguing that it would lead to
absurd results––a capped rate would not allow the City to cover its expenses for
operating the residential wastewater collection and treatment system and collect
sufficient revenues to pay on its bonds related to the system. The City also
argues that the ordinance was ambiguous when considered as a whole and that
extrinsic evidence––the City’s construction and billing practices, “Customer
Service Policy” resolution, budget projections, and financial needs for bond
payments––reveals the City’s intent to charge residents for wastewater by a
volume rate.
Under Texas law, “[t]he goal of statutory construction is to give effect to
the intent of the” enacting body. Monsanto Co. v. Cornerstones Mun. Util. Dist.,
865 S.W.2d 937, 939 (Tex. 1993). “To achieve this goal, we must first attempt
to discern that intent . . . from the plain language of the ordinance, considering
the ordinance as a whole.” City of Laredo v. Villarreal, 81 S.W.3d 865, 868 (Tex.
App. 2002) (internal citations omitted); see also City of Coppell v. Gen. Homes
Corp., 763 S.W.2d 448, 454 (stating that the wording of the entire ordinance, not
just one word or phrase, must be examined to determine the underlying intent
of the enacting body). “If the meaning of the statutory language is unambiguous,
we adopt . . . the interpretation supported by the plain meaning of the provision’s
words and terms.” Fitzgerald v. Advanced Spine Fixation Sys., Inc., 996 S.W.2d
864, 865 (Tex. 1999). “Further, if a statute is unambiguous, rules of construction
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No. 07-40465
or other extrinsic aids cannot be used to create ambiguity.” Id. at 865–66.
Nonetheless,
[t]o enforce the plain language of the ordinance does not authorize
us to employ a bloodless literalism in which text is viewed as if it
had no context. We are required to consider the context and the
consequences that would follow from a particular interpretation,
and we must avoid interpretations that would produce absurd
results or render other language mere surplusage. Construction of
a statute by the administrative agency charged with its enforcement
is entitled to serious consideration, so long as the construction is
reasonable and does not contradict the plain language of the statute.
Villarreal, 81 S.W.3d at 868 (internal quotations and citations omitted).
Regardless of ambiguity, courts can also
consider other factors to determine the Legislature’s intent,
including: the object sought to be obtained; the circumstances of the
statute’s enactment; the legislative history; the common law or
former statutory provisions, including laws on the same or similar
subjects; the consequences of a particular construction;
administrative construction of the statute; and the title, preamble,
and emergency provision.
Helena Chem. Co. v. Wilkins, 47 S.W.3d 486, 493 (Tex. 2001) (citing TEX. GOV’T
CODE ANN. § 311.023). However, where an otherwise clear statutory provision,
in the context of the remainder of the statute, is ambiguous, a reviewing court
“must look behind the words [of the statute] to determine the true purpose of the
provision.” Bridgestone/Firestone, Inc. v. Glyn-Jones, 878 S.W.2d 132, 133 (Tex.
1994).
We first turn to the language of the ordinance. It specifically provides that
residential wastewater will be charged as follows: “[f]irst 2,000 gallons,
minimum charge . . . $12.00” and “[o]ver 2,000 gallons . . . $3.40.” Importantly,
the same subsection of this ordinance contains a “winter-averaging” provision,
which states that “the rate charged for residential wastewater service during
summer months will be based on the average of December-March, if actual
consumption is less, the consumer will be charged the actual charge.” This
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No. 07-40465
provision anticipates that water usage during summer months will exceed water
usage during winter months and is written to avoid unfair increased wastewater
charges during winter months.4 Considering the ordinance as a whole, we agree
with the district court that the presence of the “winter-averaging” provision
creates an ambiguity. As the district court found, if the ordinance intended to
provide a cap on residential wastewater rates, it would be completely
unnecessary to provide for winter averaging; such language would be mere
surplusage. See Helena Chem. Co., 47 S.W.3d at 493 (stating that courts “should
not give one provision a meaning out of harmony or inconsistent with other
provisions, although it might be susceptible to such a construction standing
alone”). Therefore, we hold that the ordinance is ambiguous, which renders the
legislative intent unclear.
To resolve this ambiguity and give effect to the intent of the City, we must
apply the rules of construction and utilize appropriate extrinsic evidence. See
Mills v. Brown, 316 S.W.2d 720, 723 (Tex. 1958) (stating that courts construe
city ordinances by the same rules of construction as apply to statutes). Here, the
City has presented ample summary judgment evidence to demonstrate that it
intended to charge residents by a volume rate for wastewater amounts over 2000
gallons. First, on the same date that the subject ordinance was passed, the City
adopted a “Customer Service Policy” resolution that set forth the rate on a
volume-per-thousand basis rather than a flat basis. Second, the City adopted its
budget for 1996-97, which expressly stated that the rate for residential
wastewater was $3.40 per 1000 gallons for amounts over 2000 gallons, and
4
Wastewater rates are based on water consumption. The “winter-averaging” provision
recognizes that during summer months, several uses of water––lawn-watering, swimming
pools, and car washes––inflate water consumption but place no additional burden on
wastewater. To avoid extremely high wastewater charges for residential customers during the
summer, the City charges for wastewater based on the average of the winter months. Without
“winter averaging,” some residents would have summer wastewater charges in excess of $100.
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No. 07-40465
subsequent budgets included revenue projections based upon that volume rate.
Third, the City established that a monthly flat-rate charge, capped at $15.40 per
customer, would not produce adequate revenue to pay for the expenses of the
wastewater treatment and collection system and to repay bonds that have been
acquired for improvement of that system. The record shows that during the time
period at issue, residential customers were consistently charged $3.40 per
thousand gallons over the initial 2000 gallons and there is no evidence that
anyone ever complained about the way the City calculated the charges.
Furthermore, Jones makes no contention that the City incorrectly administered
the volume rate. Therefore, we agree with the district court that, based on this
extrinsic evidence, the primary intention of the City’s ordinance was to charge
for residential wastewater by a volume rate. Such an interpretation is
consistent with the intent of the City and avoids “absurd results.” Accordingly,
we hold that the ordinance should be construed to charge $3.40 per thousand
gallons after the initial 2000 gallons.
IV. CONCLUSION
The judgment of the district court is AFFIRMED.
7