texas-commission-on-environmental-quality-v-texas-farm-bureau-frank ( 2015 )

NUMBER 13-13-00415-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI - EDINBURG
TEXAS COMMISSION ON
ENVIRONMENTAL QUALITY, Appellant,
v.
TEXAS FARM BUREAU, FRANK VOLLEMAN,
FRANK DESTEFANO, DAVID AND MARY BALLEW,
RON AND SHERIE BURNETTE, SAM JONES,
THEODORE AND MARY KALLUS,
GLEN MARECEK, JOHN GAULDING,
AND CHARLES AND KATHERINE HARLESS, Appellees.
On appeal from the 53rd District Court
of Travis County, Texas.
OPINION
Before Justices Garza, Perkes, and Longoria
Opinion by Justice Perkes1
1 Pursuant to a docket-equalization order issued by the Supreme Court of Texas, the appeal has
This case involves the suspension of surface water rights along the Brazos River
Basin. Appellant Texas Commission on Environmental Quality (TCEQ) appeals a
summary judgment order in a suit for declaratory judgment rendered in favor of appellee
Texas Farm Bureau.2 By two issues, TCEQ argues the district court erred in holding that
sections 36.1 through 36.8 of Title 30 of the Texas Administrative Code 3 are invalid
because: (1) the district court misinterpreted the statute authorizing the creation of the
agency rules; and (2) TCEQ has the general authority to protect the public health, safety,
and welfare. We affirm.
I. BACKGROUND
TCEQ is charged with administering and enforcing the water-rights regime in
Texas. See TEX. W ATER CODE ANN. § 5.013 (West, Westlaw through 2013 3d C.S.).
One of the primary concepts of Texas water law is the doctrine of prior appropriation.
Under the doctrine, the possessor of a more senior water right has priority over junior
water right holders. Id. § 11.027. Appropriative rights are formally recognized in
permits. Id. § 11.121. These permits include specific calendar dates, called priority
dates, which establish the holder's place in the line of users. Id. § 11.141. The holder
of the permit with the earliest date on a given stream is said to be the most senior, the
been transferred to this Court from the Third Court of Appeals in Austin, Texas. See TEX. GOV'T CODE
ANN. § 73.001 (West, Westlaw through 2013 3d C.S.).
2
Also included as appellees are Frank Volleman, Frank Destefano, David and Mary Ballew, Ron
and Sherie Burnette, Sam Jones, Theodore and Mary Kallus, Glen Marecek, John Gaulding, and Charles
and Katherine Harless.
3 These sections are referred to as the “Drought Rules.” See 30 TEX. ADMIN. CODE ANN. §§ 36.1–
36.9 (West, Westlaw through 2013 3d C.S.). It is the interplay between the Drought Rules and the Texas
Water Code that is at the heart of this lawsuit.
2
holder of the permit with the next earliest date the next most senior, and so forth. TCEQ’s
jurisdiction encompasses water rights including issuing new permits and exercising
discretionary authority to enforce existing rights. Id. § 5.013.
In 2011, the Texas Legislature enacted water code section 11.053, clarifying
TCEQ's authority to administer water rights in times of drought or emergency shortage.
Id. § 11.053. Pursuant to this new statute and water code sections 5.013, 5.102 and
5.103, TCEQ adopted the “Drought Rules”, which allow the agency in times of drought or
emergency shortage to suspend certain water rights in order to allow a senior holder to
obtain water. See 30 TEX. ADMIN CODE § 36.3 (West, Westlaw through 40 Tex. Reg. No.
1152). The Drought Rules, however, also include a provision that allows the executive
director not to suspend certain junior rights—e.g., those held by cities and power
generators—based on public health, safety, and welfare concerns. See id. § 36.5(c).
TCEQ adopted the Drought Rules in April 2012 and first applied them in the Brazos
River Basin (the "Brazos") in late 2012 and early 2013. In response to severe drought,
Dow Chemical Company ("Dow"), which holds senior water rights in the lower Brazos
near the Texas coast, notified TCEQ that it was making a "senior call" (also known as a
"priority call") on water in the Brazos. A senior call occurs when the holder of a senior
water right demands that the holders of more junior water rights cease their use so that
the senior holder may exercise its right. In that regard, the senior holder asks TCEQ to
take enforcement action against junior rights to protect the senior right.4
4 In keeping with water rights jargon, senior water rights holders will frequently be referred to as
"seniors" and junior water rights holders as "juniors."
3
In response to Dow's senior call, TCEQ's executive director issued a series of
orders. The executive director suspended the use of water rights with a priority date
junior to Dow's priority date. As permitted in Section 36.5(c) of the Drought Rules,
however, TCEQ’s executive director elected not to suspend the use of certain water rights
designated for use as municipal water supplies or for electric power generation, based on
public health, safety and welfare concerns.
TCEQ commissioners thereafter modified the executive director’s order by
requiring junior water rights holders who were not suspended to provide the following
information to TCEQ within 14 days (30 days for the long-term plans): (1) reports on the
non-suspended junior's daily water use (rates and amounts of water diversion, purpose
and place of use); (2) information demonstrating that the non-suspended junior had made
reasonable efforts to obtain alternate supplies; and (3) information on what the non-
suspended junior had done to identify long-term additional or alternate water supplies.5
Texas Farm Bureau and two individual plaintiffs filed suit challenging the validity
of TCEQ's Drought Rules and seeking a declaratory judgment under Section 2001.038 of
the Texas Government Code.6 See TEX. GOV’T CODE ANN. § 2001.038 (West, Westlaw
through 2013 3d C.S.). The district court, after hearing cross-motions for summary
judgment, declared the Drought Rules invalid for the following two reasons:
(1) The rules exceed TCEQ’s statutory authority because they allow
exemption of preferred uses from curtailment or suspension order, and
such exemptions are not in accordance with the priority of water rights
established by Texas Water Code § 11.027; and
5 The original order and all amendments expired when Dow rescinded its senior call.
6 After the suit was filed, numerous other individuals joined as plaintiffs.
4
(2) Exemption of junior water rights from a priority call and curtailment or
suspension order is not authorized by TCEQ’s police power or any
general authority to protect the public health, safety, or welfare.
II. STATUTORY CONSTRUCTION
By its first issue, TCEQ argues the district court erred in holding that the Drought
Rules are invalid, and contends that the district court misinterpreted section 11.053 of the
Texas Water Code. Specifically, TCEQ asserts that: (1) the district court failed to give
proper deference to the agency’s interpretation of the statute; (2) the district court’s
interpretation is unreasonable and renders section 11.053 meaningless; and (3) the
legislative history supports TCEQ’s statutory interpretation.
A. Standard of Review
We review the granting of a motion for summary judgment de novo. Merriman v.
XTO Energy, Inc., 407 S.W.3d 244, 248 (Tex. 2013). In moving for traditional summary
judgment, a party must show there is no issue of material fact and it is entitled to judgment
as a matter of law. See TEX. RULE CIV. PROC. ANN. 166a(c) (West, Westlaw through 2013
3d C.S.). When both parties move for summary judgment, the non-prevailing party may
appeal both the grant of the prevailing party's motion as well as the denial of its own
motion. See Holmes v. Morales, 924 S.W.2d 920, 922 (Tex. 1996). When the district
court grants one party's motion and denies the other party’s motion, the reviewing court
should determine all questions presented and render the judgment that the court below
should have rendered. Comm’rs Court v. Agan, 940 S.W.2d 77, 81 (Tex. 1997); City of
Fort Worth v. Cornyn, 86 S.W.3d 320, 322 (Tex. App.—Austin 2002, no pet.).
5
In their cross-motions for summary judgment, the parties raised questions of law
that must be determined through statutory construction. “We review questions of
statutory construction de novo.” Molinet v. Kimbrell, 356 S.W.3d 407, 411 (Tex. 2011).
Our fundamental objective in interpreting a statute is “to determine and give effect to the
Legislature's intent.” Am. Zurich Ins. Co. v. Samudio, 370 S.W.3d 363, 368 (Tex. 2012);
accord Molinet, 356 S.W.3d at 411. In turn, “[t]he plain language of a statute is the surest
guide to the Legislature's intent.” Prairie View A & M Univ. v. Chatha, 381 S.W.3d 500,
507 (Tex. 2012). “We take the Legislature at its word, and the truest measure of what it
intended is what it enacted.” In re Office of Attorney Gen., 422 S.W.3d 623, 629 (Tex.
2013). “[U]nambiguous text equals determinative text,” and “‘[a]t this point, the judge's
inquiry is at an end.’ ” Id. (quoting Alex Sheshunoff Mgmt. Servs., L.P. v. Johnson, 209
S.W.3d 644, 652 (Tex. 2006)); see In re Lee, 411 S.W.3d 445, 450–451 (Tex. 2013).
It is inappropriate to resort to rules of construction or extra-textual information to
construe a statute when its language is clear and unambiguous. Id. “This text-based
approach requires us to study the language of the specific section at issue, as well as the
statute as a whole.” Id. When construing the statute as a whole, we are mindful that
“[i]f a general provision conflicts with a special or local provision, the provisions shall be
construed, if possible, so that effect is given to both.” TEX. GOV'T CODE ANN. § 311.026(a)
(West, Westlaw through 2013 3d C.S.). However, in the event that any such conflict is
irreconcilable, the more specific provision will generally prevail. Id. § 311.026(b); see
also In re Allcat Claims Serv., L.P., 356 S.W.3d 455, 470–71 (Tex. 2011). Further, in the
event of an irreconcilable conflict between two statutes, generally “the statute latest in
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date of enactment prevails.” TEX. GOV'T CODE ANN. § 311.025(a); see Lee, 411 S.W.3d
at 450–451. Construction of a statute by an administrative agency charged with its
enforcement is entitled to serious consideration, as long as the construction is reasonable
and does not contradict the plain language of the statute. Tarrant Appraisal Dist. v. Moore,
845 S.W.2d 820, 823 (Tex. 1993). This standard is applicable to both issues in this case,
as each deals with statutory construction and interpretation.
B. Applicable Law
Section 11.053 of the Water Code reads as follows:
(a) During a period of drought or other emergency shortage of water, as
defined by commission rule, the executive director by order may, in
accordance with the priority of water rights established by Section
11.027:
(1) temporarily suspend the right of any person who holds a water
right to use the water; and
(2) temporarily adjust the diversions of water by water rights holders.
(b) The executive director in ordering a suspension or adjustment under
this Section shall ensure that an action taken:
(1) Maximizes the beneficial use of water;
(2) Minimizes the impact on water rights holders;
(3) Prevents the waste of water;
(4) Takes into consideration the efforts of the affected water rights
holders to develop and implement the water conservation plans
and drought contingency plans required by this chapter;
(5) To the greatest extent practicable, conforms to the order or
preferences established by Section 11.024; and
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(6) Does not require the release of water that, at the time the order
is issued, is lawfully stored in a reservoir under water rights
associated with that reservoir.
(c) The commission shall adopt rules to implement this Section,
including rules:
(1) Defining drought or other emergency shortage of water for the
purpose of this Section; and
(2) Specifying the:
a. Conditions under which the executive director may issue
an order under this Section;
b. Terms of an order issued under this Section, including the
maximum duration of a temporary suspension or
adjustment under this Section; and
c. Procedures for notice of, an opportunity for a hearing on,
and the appeal to the commission of an order issued under
this Section.
TEX. W ATER CODE ANN. § 11.053. This section references two additional sections of the
water code, 11.027 and 11.024. Section 11.027 states that “[a]s between appropriators,
the first in time is the first in right”, whereas section 11.024 prioritizes water users based
on the nature of use. Id. § 11.027; see id. § 11.024.7
Pursuant to its authority under section 11.053(c), TCEQ adopted the Drought
Rules, which contain the following clause: “The executive director may determine not to
suspend a junior water right based on public health, safety, and welfare concerns. . . .”
30 TEX. ADMIN. CODE § 36.5(c). In this regard, we look to the statutory language to
7 Section 11.024 states that “[i]n order to conserve and properly utilize state water, the public
welfare requires not only recognition of beneficial uses but also a constructive public policy regarding the
preferences between these uses.…” TEX. W ATER CODE ANN. § 11.024 (West, Westlaw through 2013 3d
C.S.).
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determine whether section 11.053 allows TCEQ to deviate from the “first in time, first in
right” principle of section 11.027. See TEX. WATER CODE ANN. § 11.027.
C. Analysis
TCEQ contends section 11.053 is ambiguous and therefore the agency’s statutory
construction is entitled to deference. The apparent ambiguity is between the language
“shall ensure” in 11.053 (b) and “in accordance with” found in 11.053(a). TCEQ reasons
that it is impossible to ensure the 11.053(b) objectives are met if the agency must always
follow the strict priority doctrine stated in 11.053(a). TCEQ interprets section 11.053 as
requiring the agency to consider the mandatory factors identified in 11.053(b) which may
result in some departure from the strict application of time priority.
In support of its argument, TCEQ cites Rail Road Commission of Texas v. Texas
Citizens for a Safe Future & Clean Water, 336 S.W.3d 619 (Tex. 2011). In that case,
Citizens sought judicial review of the Texas Railroad Commission's decision to grant a
permit to a company to operate commercial injection wells for disposal of gas and waste.
Id. at 622. At issue was the Commission’s definition of “public interest”, which is not
defined by statute. Id. at 621. The Texas Supreme Court held that the term “public
interest” was “anything but clear and unambiguous” and further concluded that the
agency’s interpretation was reasonable and therefore entitled to deference. Id. at 628.
Deference to an agency’s interpretation is permissible, however, only if the
meaning of the section or statute in question is not clear. Meno v. Kitchens, 873 S.W.2d
789, 792 (Tex. App.—Austin 1994, writ denied); see Moore, 845 S.W.2d at 823; Stanford
v. Butler, 181 S.W.2d 269, 273 (Tex. 1944). Thus, to give weight to TCEQ’s
9
interpretation of Section 11.053, we must first conclude that the statute is ambiguous.
This we cannot do.
The meaning of the statutory language is clear. Section 11.053(b) states that the
factors noted apply to suspensions or adjustments under this section. See TEX. W ATER
CODE ANN. § 11.053(b). The entire section of 11.053 must be accomplished in
accordance with the priority of water rights established by section 11.027. See id. §
11.053(a). No specific language was included that would allow TCEQ to depart from the
time priority of 11.027; rather, the statute expressly states the opposite. See id. The
agency’s interpretation would allow senior water rights holders to be suspended before
their junior counterparts, which is inconsistent with the plain meaning of the statute. As
such, we decline to defer to TCEQ’s interpretation.8 See Citizens, 336 S.W.3d at 622;
City of Plano v. Pub. Util. Comm’n, 953 S.W.2d 416, 421 (Tex. App.—Austin 1997, no
pet.).
In addition to arguing that we must defer to its interpretation, TCEQ argues that
the district court’s interpretation of section 11.053 is unreasonable because it renders the
statute meaningless and incapable of execution. The district court concluded that the
Drought Rules adopted under section 11.053(c) exceed the statutory authority because
TCEQ must determine suspensions “in accordance with” the “first in time” principle found
in section 11.027. See TEX. W ATER CODE ANN. § 11.053(a).
8
Since section 11.053 is unambiguous, there is no need to consider extra-textual information.
See In re Lee, 411 S.W.3d 445, 450–51 (Tex. 2013).
10
TCEQ argues that the legal and practical effect of the district court’s interpretation
is that TCEQ has little more than the authority to enforce priorities. Instead, according
to TCEQ, the purpose of section 11.053 is to allow the agency to consider the factors of
11.053(b) and “strike a balance” between enforcing priorities and exacerbating a situation
in which there are public health, safety and welfare concerns. TCEQ asserts that section
11.053(b) requires the agency to base suspension orders on factors other than seniority
and points to the fifth factor of 11.053(b) which states that the executive director shall
ensure that any suspension or adjustment “to the greatest extent practicable, conforms
to the order of preferences established by section 11.024.” 9 According to TCEQ,
because of this phrase, it is not practical to require the agency to comply with strict priority
when applying section 11.053(b)(5). It asserts that if the agency must comply with strict
time compliance, then a small community hospital would have its appropriation
suspended or adjusted before a recreational fishing pond.
We are required, first and foremost, to follow the plain meaning of the statute. See
Crosstex Energy Serv., L.P. v. Pro Plus, Inc., 430 S.W.3d 384, 388 (Tex. 2014). The
Legislature chose specific language in each subsection of 11.053. The qualifier “in
accordance with” as it pertains to section 11.027 is not the same qualifier as “to the extent
practicable” as it pertains to section 11.024. A plain reading of the statute indicates that
the Legislature intended for the priority system established under section 11.027 to take
precedence in any type of suspension or adjustment. The mere fact that a policy seems
9 Section 11.024’s hierarchy of preferences for appropriations are: (1) domestic and municipal
purposes; (2) agricultural and industrial uses; (3) mining and mineral recovery; (4) hydroelectric power;
(5) navigation; (6) recreation and pleasure; and (7) other beneficial uses. See TEX. W ATER CODE ANN. §
11.024.
11
unwise or inconsistent with other policies does not justify a departure from the plain
meaning of a legislative mandate. Meno, 873 S.W.2d at 792; see R.R. Comm’n v. Miller,
434 S.W.2d 670, 672 (Tex. 1968). Similarly, it is not the court’s role to examine
microscopically the Legislature’s intent when interpreting a clear statutory command.
Meno, 873 S.W.2d at 792.
TCEQ’s argument further fails to consider the existing statutory scheme for dealing
with emergency appropriations. Section 11.139 of the Water Code allows TCEQ to
divert water to meet urgent public health and safety needs. See TEX. W ATER CODE ANN.
§ 11.139. Section 11.139 gives the executive director the power to grant an emergency
request for a diversion from a user. See id. While it may seem that the Drought Rules
incorporate this authority, the rules give TCEQ the additional power to identify public
health, safety, and welfare concerns and to divert water solely at the discretion of the
executive director. Though section 11.139 is fundamentally different than section
11.053, it appears the Legislature did provide a mechanism for emergency appropriations
based on urgent public health and safety concerns.
Additionally, TCEQ is not precluded from adopting rules that comply with both the
11.053(a) first in time principle and the 11.053(b) factors. As appellee notes, section
11.053(b) establishes guidelines for TCEQ’s exercise of authority by requiring TCEQ to
balance certain factors when ordering a suspension or adjustment. To the extent TCEQ
argues that it must strike a balance between the 11.053(b) factors and 11.027 priorities,
we disagree. As we previously noted, the plain language of 11.053(a) states otherwise.
We conclude the district court correctly found that section 11.053(a) requires TCEQ to
12
apply the section 11.053(b) factors within the framework of “first in time, first in right.”
See In re Lee, 411 S.W.3d at 450–451. We overrule TCEQ’s first issue.
III. AGENCY AUTHORITY10
By its second issue, TCEQ complains that the district court erred in concluding that
“[e]xemption of junior water rights from a priority call and curtailment or suspension order
is not authorized by TCEQ’s police power or any general authority to protect the public
health, safety, or welfare.” TCEQ asserts that the district court’s conclusion runs counter
to the policies and duties identified by the Legislature, the State Constitution, and the
courts.
A. Applicable Law
The powers of an agency include the powers delegated by the Legislature in clear
and express statutory language, together with any implied powers that may be necessary
to perform a function or duty delegated by the Legislature. GTE Sw., Inc. v. Pub. Util.
Comm'n, 10 S.W.3d 7, 12 (Tex. App.—Austin 1999, no pet.). When the Legislature
expressly confers a power on an agency, it also impliedly intends that the agency have
whatever powers are reasonably necessary to fulfill its express functions or duties. Pub.
Util. Comm'n v. City Pub. Serv. Bd. of San Antonio, 53 S.W.3d 310, 316 (Tex. 2001). An
agency may not, however, exercise what is effectively a new power, or a power
contradictory to the statute, on the theory that such a power is expedient for administrative
purposes. Id. We defer to the agency's interpretation of its own powers only if that
interpretation is reasonable and not inconsistent with the statute. Id.; see Brazoria
10TCEQ’s second issue also concerns statutory construction; therefore, the standard of review is
the same as the first issue.
13
County v. Tex. Comm’n on Envtl. Quality, 128 S.W.3d 728, 734 (Tex. App.—Austin 2004,
no pet.); Moore, 845 S.W.2d at 823.
B. Analysis
As previously discussed, section 11.053 specifically makes all drought curtailment
rulemaking or enforcement actions subject to the prior appropriation doctrine. TCEQ
identifies several statutory and one constitutional provision that purport to give TCEQ
general power to act in the public interest. See TEX. CONST. art. 16 § 59(a) (describing
the conservation and development of natural resources as public rights and duties); TEX.
WATER CODE ANN. §§ 11.134(b), 11.024, 12.014.
The cited water code sections, however, pertain to TCEQ’s authority when acting
on new water permits and authorizing new appropriations. See TEX. W ATER CODE ANN.
§§ 11.134(b), 11.024, 12.014. None of the statutes or the constitutional provision cited
by TCEQ give the agency the general authority to suspend water rights after they have
been issued. TCEQ also identifies general policy declarations found in water code
sections 5.013, 5.102, and 5.103. See TEX. W ATER CODE ANN. §§ 5.013, 5.102–.103.
As Texas Farm Bureau notes, however, courts have consistently rejected appeals to
statements of the general purpose of a statute as implicit declarations of broad authority
when the Legislature has elsewhere expressly set forth the bounds of an agency’s
authority with specificity. See GTE Sw. Inc., 10 S.W.3d at 12.
We may not make such an inference unless these grants of regulatory authority
will themselves be defeated absent an attendant authority to decide curtailments and
suspensions based on public health, safety, and welfare concerns. See id. TCEQ has
14
made no such claim. While we recognize TCEQ’s authority to manage and regulate the
state’s scarce water resources, such authority must not exceed its express legislative
mandate. See id. We conclude that TCEQ’s police power and general authority does
not allow TCEQ to exempt junior preferred water rights from suspension based on public
health, safety, and welfare concerns. Rather, section 11.053 specifically sets forth the
limits of the agency’s powers in times of drought. See Pub. Util. Comm'n, 53 S.W.3d at
316. Accordingly, we overrule TCEQ’s second issue.
IV. CONCLUSION
We affirm the judgment of the district court.
GREGORY T. PERKES
JUSTICE
Publish
TEX. R. APP. P. 47.2(c)
Delivered and filed the
2nd day of April, 2015.
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