The first water law case I ever got involved in was a CCN fight. A Certificate of Convenience and Necessity (CCN) is a permit issued by the Texas Commission on Environmental Quality that grants its holder a monopoly power to provide water or sewer utility service to a geographically defined area. The key word here is “monopoly.” In return for that power, the CCN holder must provide “continuous and adequate” service to that area.
In my case, a city’s CCN included its city limits, and also included the city limits of an adjacent city. The CCN City had higher local taxes, in part to manage and maintain its municipal water supply. Eventually the CCN City felt like it was unfairly subsidizing the smaller city’s water system, because the CCN City could not collect taxes from this smaller city. This made the smaller city more competitive for economic development projects, robbing the CCN City of a future tax base as well. The smaller city also had no zoning or development code, and the CCN City didn’t want to see more “substandard” development.
So the CCN City decided to terminate its CCN, and turn off the water supply to the smaller city. The idea was to force the residents of the smaller city to disannex their property from the smaller city, and annex into the CCN City, using a denial of water service as the velvet glove. Once the property owners annexed into the CCN City, their water service would be instantly restored.
To that end, the CCN City filed its application with the TCEQ to terminate its CCN. My client filed an objection, as did others, and so the TCEQ sent the case to the State Office of Administrative Hearings (SOAH). SOAH appointed an administrative law judge to hear the case (similar to a state district court judge with no jury) and come up with a recommendation to the TCEQ. We ended up going through a three day evidentiary hearing, and the judge recommended that the TCEQ deny the application to terminate the CCN. The smaller city was saved from extinction.
The CCN City put on their public works engineer, who concocted this hypothetical story that I knew was whackadoodle crazy, due to my experience with how a developer really develops real estate. And I was determined this engineer was going to admit as much on the witness stand. Of course, he was just as bent on not giving up the truth of this matter. So we went to wrasslin. It took a few hours of cross examination, and one judge-called time-out to let us cool down, for me to finally corner him, ask the question in yes-or-no only terms, and get the judge to order him to answer only yes or no. Lo and behold, the truth came out.
We all bring our past experiences with us to face new challenges. So some lawyers have more experience with administrative law, and come at a case like this from that strength. I had a leg up on the adversaries in this hearing because of my experience with normal real estate due diligence I knew developers conducted before improving property. And I think that’s one of my strengths. I’m not a trial lawyer or administrative hearings lawyer first. I’m a real estate lawyer first and foremost. Real estate is at the basis of every water right and environmental case.
There are many reasons I enjoy water law so much. I enjoy persuasive writing, and there is more writing in application and permit processes. I like to read, which is a good thing because I’ve never seen an area of the law generate so much reading material. I like the certainty of knowing that scheduled hearings will happen. In civil trials, the case can take several docket settings before the trial actually occurs. And I like the complexity of water law. It sits at the intersection of physics, geology, hydrology, finance, politics, and all the normal real estate principles I’ve learned in the last 20+ years. I count myself fortunate to have found areas of the law I enjoy practicing.
