### T E X A S C O U R T O F A P P E A L S , T H I R D D I S T R I C T , A T A U S T I N

NO. 03-12-00692- CV

Nort h Central Texas Council of Gove rnm ents, Appellant

v. MRSW Managem ent, LLC, Appellee

F ROM TH E DISTRI CT COURT O F TRAVIS CO UNTY, 200 TH JUDICI AL DISTRICT NO. D-1 -GN-1 1-0 0244 7, H ONO RAB LE AMY CLARK MEACH UM, J UDGE P RESIDING

O P I N I O N

North Central Texas Counc il of Gover nments (NCTCOG) bring s this interloc utory appea l from the trial court’s order deny ing its pleas to the jurisdiction. See Tex. Civ. Prac. & Rem. Code § 51.014(a) (8). For the rea sons that follow, we reve rse the trial court’s orde r and rende r judgme nt dismi ssing a

ppellee MRSW Manag ment, L L C’s claims ag ainst NCTCOG.

BACK GR OUND NC T C OG , a reg ional planning commission, was formed under chapte r 391 of the L ocal Gover

nment Code. See Tex. L oc. Gov’t Code §§ 391.001–.015; City of Frisco v. Commission

on State Emerge ncy Commc’n , No. 03-08-00579- CV, 2009 Tex. App. L EXI S 5314, at *5–6 (Tex. App.—Austin J uly 9, 2009, no pet.) (mem. op.) (reco gn i z i n g NC TCOG as one of the reg ional planning commissions operating in the state).I n Aug ust 2010, NCTCOG enter ed into a “Procur ement Ag ree men t” ( th e A g r e e me n t) with the Texas State Administrative Ag ency (SAA), which is a division of the Depa rtment of Public Safety (collec tively , DPS), to “procur e planning service s.” The Ag ree ment descr ibes the scope of work a s follows:

NCTCOG will procur e planning service s for [ DP S ] t o support statewide planning eff orts in are as such as g rants, manag ement, ri sk assessment, investment justifications, strateg ic planning , part time g rant manag ement, and additional planning activities to be identified.

The terms of the Ag ree ment include that “NCTCOG covena nts and repr esents that it is only serving

as the conduit for funding for [DP S] ” and “NCTCOG does not set the projec t standards or judge the eff ectivene ss of the work pe rfor med. [DPS ] sol ely

reta ins those rig hts and responsibilities.” The Ag ree ment states that it is enter ed into “[p] ursuant to the I nterloca l Cooperation Act, Chapter 791 of the Texas Gover nment Code,” see Tex. Gov’t Code §§ 791.001–.035 (I nterloca l Cooperation Contracts), and that “[DPS ] will provide NCTCOG with selec ted contra ctors.” One of the contractors that DPS selec ted and NCTCOG hired to provide service s to DPS was MRSW , a private information and technolog y contra ctor. MRSW ’s service s wer e rela ted to homeland secur ity g rant manag ement prog rams. The funds to pay for the service s wer e to flow from DPS to NCTCOG to MRSW

. Pursuant to the Ag ree ment, NCTCOG issued purcha se order s to MRSW

. MRSW there afte r provided se rvice s to DPS and invoiced N CTCOG for those se rvice s.

After DPS terminated the Ag ree ment and did not rele ase funds to N CTCOG to pay MRSW , NCTCOG did not pay invoiced amounts to MRSW

. Ba sed upon NCTCOG’s failure to pay the invoiced amounts, MRSW filed this suit in Aug ust 2011 ag ainst NCTCOG, alleg ing that MRSW
2had provided service s and that it had not been pa id for those ser vices. MRSW asser

ted bre ach of 1
contra ct, sworn acc ount, quantum meruit, attorney ’s fee s, and decla ratory relief

. NC TCOG

answe red and filed third party claims ag ainst the State of Texas, DPS, and its subsidiaries, SAA and Texas Homeland Secur ity . NCTCOG and the third pa rty defe ndants filed pleas to the jurisdiction

o n i mmunity g rounds. After a hear ing, the trial court g rante d the pleas in J anuar y 2012 an d dismiss ed MRSW ’s suit and NCTCOG’s third party claims. MRSW then filed a motion for new trial only with respe ct to NCTCOG’s plea to the jurisdiction. The trial court g rante d the motion and reinstated the case ag ainst NCTCOG. There afte r, the parties conducte d discovery , including taking numerous depositions.

I n J une 2012, NCT C OG fi l ed an amende d answe r and plea to the jurisdiction. NCTCOG asser

ted g overnme ntal immunit y and that it had not waived its immunity under c hapter 2 7 1 of the L ocal Gover

nment Code. See Tex. L oc. Gov’t Code § 271.152 (wa iving im m u n i t y o f local g overnme nt entity to suit for cer tain clai ms). MRSW filed a response to the plea. MRSW arg ued that NCTCOG did not have immunit y under chapte r 391 of the L ocal Gover nment Code or, al t er n at ively , that chapte r 271 waived immuni ty

. Although both parties filed evidenc e to sup p o rt

I n a separ ate suit, MRSW broug ht claims direc tly ag ainst DPS and reque st ed t h at t he 1 dispute be re fer

red to the State O ffice of Administrative Hea ring s (SOAH) under Chapter 2260 of the Gover nment Code. See MRSW Mgmt. LLC v. Texas Dep’ t of Pub. Safety, No. 04-12-00715- CV, 2013 Tex. App. L EXI S 5369 (Tex. App.—San Antonio May 1, 2013, no pet. h.); see also Tex. Gov’t Code §§ 2260.001–.108. The SOAH judge conclude d that the matter should be dismiss ed beca use MRSW did not have a contra ct that met the definition of “contr act” contained in section 2260.001(1) of the Gover

nment Code. See MRSW Mgmt. LLC , 2013 Tex. App. L EXI S 5369, at *3, 7. Our sister court a ffirme d the trial cour t’s order aff irming SOAH ’s orde r. See id . at *11. 3their pleas, the rele vant fac ts wer e not disputed. After a hear ing, the trial court denied NCTCOG’s 2 amende d plea. This interloc utory appea l followed.

ANALYSIS NCTCOG raises three issues on appea l. I t urg es that the trial court err ed by deny ing its plea to the jurisdiction beca use: (i) it was entitled to g overnme ntal immunit y fr o m s u i t and liability ; (ii) g overnme ntal immunit y attache d in this ca s e b ec ause the “planning and purcha sing functions” perf

ormed on behalf of DPS are statutorily classified as “g overnme ntal functions and service s” under section 791.003 of the Gover nment Cod e; and (iii) its immunit y was not waived under se ction 271.152 of the L ocal Gove rnment Code.

Stand ard of Review

We revie w a trial court’s order on a plea to the jurisdiction de novo. See Texas Dep’ t of Parks & W

ildlif e v. Miranda , 133 S.W .3d 217, 226 (Tex. 2004). We focus first on the plaintiff’s petition to deter

mine whether the pleade d fac ts af fi rm at i vely demonstrate that subject matter jurisdiction e x ists. Id. at 226. We c onstrue the pleading s liberally in favor of the plaintiff. Id

. “I f the pleading s do not contain sufficie nt fac ts to aff irmatively demonstrate the trial court’s jurisdiction but do not aff

irmativ el y demonstrate incurable defe cts in jurisdiction, the i ssue i s one of pleading sufficie ncy and the plaintiffs should be afforde d the opportuni ty to amend.” Id

. “I f t he pleadings aff irmati v el y neg ate the exis tence of jurisdiction, then a plea to the jurisdiction may be g rante d

The parties’ evidenc e included a copy of the Ag ree ment, purcha se order s by NCTCOG to 2 MRSW , and excer

pts from depositions. 4without allowing the plaintiffs an opportunity to amend.” Id

. at 227. I f a plea to the jurisdiction

ch al l en ges t he ex istence of jurisdictional fac ts, the t rial court may consider evidence and mus t d o

s o wh en n ecessary to resolve the jurisdictional issues raised. Id .; Bland Indep. Sch. Dist. v. Blu e , 34 S.W .3d 547, 554 (Tex. 2000)

. I f the jurisdictional evidenc e is undisputed or does not raise a fac t question, the trial cour

t must rule on the plea a s a matter of law. Miranda , 133 S.W .3d at 228. We also revie w mat ters of statutory construction de novo. See Texas Mun. Power Agenc y v. Public Util. C o mm ’n , 253 S.W .3d 184, 192 (Tex. 2007). Of primary conce rn in construing a statute is the express statutory lang uag e. See Galbraith Eng’g Consultant s, Inc. v. Pochucha , 290 S.W .3d 863, 867 (Tex. 2009). “W e thus construe the text according to its pl ain and common meaning unless a contra ry intention is appar ent from the contex t o r u nless such a construction leads to absurd results.” Presidio Indep. Sch. Dist. v. Scott , 309 S.W .3d 927, 930 (Tex. 2010) (citing City of Rock wall v. Hughes , 246 S.W .3d 621, 625–26 (Tex. 2008)). We consider the entire a ct, not isolated portions. 20801, Inc. v . Parker , 249 S.W .3d 392, 396 (Tex. 2008).

Gove rnm ental Im m uni ty

I n its fir st a

nd second issues, NCTCOG contends that it is entitled to g overnme ntal immunit y from suit and liability as a political subdivision of the state and that g overnme ntal immunit y attache d to its actions reg arding MRSW ’s claims beca use it was perf

orming g overnme ntal functions when it enter ed into the Ag ree ment with DPS and t h en p urcha sed service s for DPS from MRSW

. Gover

nmental i mmunity deprive s a trial court of subject m atter j u ri sdiction unless t h e political subdivision consents to suit and is proper ly asser ted i n a plea to the j urisdiction. See
5Rolling Plains Groundwater Conservation Dist. v

. City of Aspermont , 353 S.W .3d 756, 759 (Tex. 2011) (per curia m) (noting that p o l i t i ca l subdivisions of the state are “entitled to g overnme ntal immunit y from a suit for mo n ey d am age s u nless it has been waived” ); Miranda , 133 S.W .3d at 225–26 (noting that sovere ign immuni ty “prope rly asser ted in a plea

to the j urisdiction”). “When perf orming g overnme ntal functions, political subdivisions derive g overnme ntal immunit y from the state’s sovere ign immunit y .” City of Houston v. W

illiams , 353 S.W .3d 128, 134 (Tex. 2011) (citing City of Galveston v. State , 217 S.W .3d 466, 469 (Tex. 2007)); see also City of El Paso v. Heinrich , 284 S.W .3d 366, 372 (Tex. 2009) (“Sover eig n immunit y protec ts the State from lawsuits for money damag es.” (citing Texas Nat u r a l Res. Conservation Comm’n v. IT-Davy , 74 S.W .3d 849, 853 (Tex. 2002))). A reg ional planning commission, such as NCTCOG, is define d in chapte r 391 of the L ocal Gover

nment Code as a “political subdivision of the state.” See Tex. L oc. Go v ’t Code § 391

. 0 0 3 (c ); see also id

. § 391.002(2) (def ining “Commissi on” to mean “re g ional planning commission, co u n ci l of g overnme nts, or simil ar reg ional planning ag ency cre ated under this chapte r”) . As a poli tical s ubdivision of t he st ate, NCTCOG is entitled to g overnme ntal immunit y from suit when it is perf

orming g overnme ntal functions. See City of Aspermont , 353 S.W .3d at 759; W illiams , 353 S.W .3d at 134. 3

Beca use we conclude that NCTCOG’s challeng ed actions wer e made while perf orming 3 go v er n mental functions, we do not addre ss the applicability of the g overnme ntal-propr ietary dichotomy that has been used to deter mine immunit y from suit for tortious condu ct

. S ee Tooke v. City of Mex ia , 197 S.W .3d 325, 343 (Tex. 2006) (di scussing g overnme ntal-propr ietary dichotomy ). 6M RSW urg es that g overnme ntal immunit y does not apply beca use NCTC OG ’s actions—as a “mer e ag ent of the State”—we re outside the scope of its statutory authority

. MRSW

asser ts that chapte r 391 did not authorize NCTCOG to contra ct with a state ag ency like DPS or with

a private party like MRSW and, there fore , that NCTCOG’s actions wer e outside its st at u t o ry authority and subjected it to suit and liability just like any other corpor ation. MRSW ’s arg ument fails to take into acc ount that the source of NCTCOG’s statutory authority is not limit ed to chapte r 391, which chapte r authorizes the exis tenc e of reg ional planning commissions and provides that local g overnme nts may eng ag e in re g ional planning as a g roup in a re g ional planning commission and still be a local g overnme nt entity , not a “cor poration.” See gene r a lly Tex. L oc. Gov’t Code §§ 391.001–.015 (addr essing reg ional planning commissions in chapte r of Subtit le C, “Planning and Deve lopment Provisions Apply ing T o More Tha n One Ty pe of L ocal Gove rnment”)

. The leg islatu re expressly confe rre d statutory authority to reg ional planning commissions in p ar t s of the Gover nment Code, including chapte r 791. NCTCOG has express authority to contra ct with the state or a state ag ency to purcha se g oods and service s under that chapte r. See Tex. Gov’t Code §§ 791.001–.035 (I n te r lo cal Cooperation Act). Section 791.025, titled “Contrac ts for Purcha ses,” state s: “A local g overnme nt, inc luding a counc il of g overnme nts, may ag ree with a

nother local g overnme nt or with the state or a

state ag ency , including the comptroller, to pu rc h ase g oods and service s.” Id

. § 791.025(a)

. Subsection (d) of section 791.025 define s “counc il of g overnme nts” to mean “a reg ional planni n g commission cre ated under Chapter 391, L ocal Gove rnment Code.” Id

. § 791.025(d). The Ag ree ment and purc hase or ders he re f all within the plain lang uag e of section 791.025: NCTCOG—a local g overnme nt—ag ree d with DPS—a state

7ag ency

—to purcha se service s. See id

. § 791.025(a) ; Scott , 309 S.W .3d at 930. The section does not limit the local g overnme nt’s choice of the provide r of the g oods or servic es.

MRSW urg es that cha

pter 791 of the Gover

nment Code does not apply beca use its purpose is limit ed to “incr eas[ing] the eff iciency and eff

ectivene ss of local g overnme nts.” See Tex. Gov’t Code § 791.001. MRSW arg ues that NCTCOG’s challeng ed actions did not “increase the efficiency and eff

ectivene ss of local g overnme nts” and that section 791.025 “ca nnot be re ad t o include the u s e o f a local g overnme nt, including a council of g overnme nts, as a mere purcha sing ag ent for the State, wher e no local g overnme nt or council rec eived any benef it.” Section 791.001, h o w e v e r , e x pressly authorizes local g overnme nts like NCTCOG “to contra ct, to the g rea test possible extent . . . with age ncies of the state.” See id

. We de cline to inter pret section 791.001 to prec lude section 791.025’s a

pplication here

. See Parker , 249 S.W .3d at 396. MRSW also urg es t hat chapter 791 does not apply beca use i ts petition all eged that the service s that it provided wer e for “consultation and prog ram manag ement s e r v ic e s ” a nd that these ty pes of servi ces do not fall within the cate g ories of service s listed in section 791.003. See Tex. Gov’t Code § 791.003. Section 791.003 define s “g overnme ntal functions and service s” to include “planning ,” “administrative functions,” and “other g overnme ntal functions in which the contra cting parties are mutually interested.” Id

. § 791.003(3)( I ), (K), (N). “Administrati v e fu n ctions” are define d to mean “func tions normally associate d with the routine opera tion of g overnme nt, including

. . . purcha sing.” Id

. § 791.003(1). I t was MRSW ’s burden to aff irmatively establish or raise a fac t issue that imm u n i t y d i d not apply

. See Miranda , 133 S.W .3d at 228. Reg ardle ss of how MRSW char acte rized the service s that it provided to DPS in its pleading s, the undisputed evidenc e was that

8NCTCOG purcha sed the service s from MRSW for DPS and that the service s conce rned homeland

secur ity prog rams. See id. Ba sed upon thi s evidence, we conclude that NCTCOG’s challeng ed actions fa ll within t he mea ning of “purc hasing ,” “planning,” or other f unctions of mutual interest. See Tex. Gov’t Code § 791.003(1), (3)( I ), (K), (N); Scott , 309 S.W .3d at 932; Miranda , 133 S.W .3d at 228. To the extent that MRSW arg ues that NCTCOG did not raise section 791.003 befor e the trial court, the Ag ree ment was jurisdictiona l evidenc e befor e the trial court. The Ag ree ment states that it was an “I nterl o ca l C o o p er ative Ag ree ment enter ed into under chapte r 791 of the g overnme nt code.” See Tex. Gov’t Code § 791.003(2) (def ining “interloc al contra ct” as “a contra ct

or ag ree ment made under this chapter” ). Ba sed upon the undisputed evidenc e, we conclude that NCTCOG was perf

orming go v ernme ntal functions when it enter ed into the Ag ree ment and then issued pu rc h ase orders to MRSW and that NCTCOG has gover nmental i mmunity from MR SW ’s claims. See id

. §§ 791.003, .025; W illiams , 353 S.W .3d at 134. We sustain NCTCOG’s first and second issues.

Waiver of Im m uni ty Under Chapter 271

I n its third issue, NCTCOG contend s that immunit y was not waived under section 271.152 o f t h e L ocal Gover nment Code beca

use MRSW never pleade d waiver , MRSW failed to raise a materia l fac t issue reg arding the application of section 271.152, and it is “undisputed that the g oods and service s at issue wer e provided to and for the sole benef it of DPS.” See Tex. L oc. Gov’t Code § 271.152.

9“I n a sui t ag ainst a gover nmental uni t, the pl aintiff mus t aff irmatively demonstrate the court’s jurisdiction by alleg ing a vali d wa i v er o f immunit y .” Dallas Area Rapid Transit v. W hitley , 104 S.W .3d 540, 542 (Tex. 2003); see Tex as Dep’t of Transp. v. Jones , 8 S.W .3d 636, 638 (Tex. 1999) (desc ribing distinction betwee n immunit y from suit, which bars the action, and immunit y from liability ). I mmunity from suit may o n l y b e waived by “cle ar and unambig uous” lang uag e. Tex. Gov’t Code § 311.034 (addr essing waiver of sovere ign immunit y ); Tooke v. City of Mex ia , 197 S.W .3d 325, 328 n.2 (Tex. 2006) (noting that “we ll-established rule” that leg islature may onl y waive sovere ign immunit y by “cle ar and unambig uous lang uag e” also applies to waiver of immunit y for other g overnme ntal entities); see Jones , 8 S.W .3d at 638 (plaintiff must establish express consent to suit “by ref ere nce to a st atute or to express leg islative permission”). To de fea t NCTCOG’s plea then, MRSW had to aff irmatively demonstrate a valid waiver of immunit y by clea r and unambig uous lang uag e.

Section 271.152 waives immunit y to suit for cer tain brea ch of contra ct claims ag ainst local g overnme ntal entities. See Tex. L oc. Gov’t Code § 271.152. A contra ct that is subject to the waiver in section 271.152 is define d to mean “a written contra ct stating the essential terms of the ag ree ment for providing g oods or service s to the local g overnme ntal entity that is proper ly executed

on behalf of the local g overnme ntal entity .” See id

. § 271.151(2). NCTCOG is a “loca l g overnme nt entity ” as that term is define d in chapte r 271 and, there fore , could waive its immunity from suit by enter ing into a contra ct subject to that chapte r. S ee i d

. § 271.151(3) (def

ining “loca l g overnme nt entity ” to mean “a political subdivision of this state, other than a county or unit of state g overnme nt as that term is def

ined by Section 2260.001, Gover nment Code”).

10MRSW ar gu es that the undisputed evidenc e showed that MRSW enter ed into a

contra ct with NCTCOG that was subject to th e chapter beca use it was “for providing g oods or service s to NCTCOG.” Even if we assume that MRSW pleade d waiver befor e the trial court, it was undisputed that the servic es at issue we re pr ovided to DPS, not NC TCOG. The pla in lang uag e of

s ec t i on 271.151 limit s its rea ch to ag ree ments “for providing g oods or service s to the lo ca l g overnme ntal entity .” See Sc ott , 309 S.W .3d at 932; see also Kirby Lake Dev ., Ltd. v. Clear Lake City W ater Auth. , 320 S.W .3d 829, 838–39 (Tex. 2010) (interpr eting section 271.151 to require that “g oods or service s” be provided to local contra cting g overnme ntal entity ); East Houston E s t a te Apartments, LLC v. City of Houston , 294 S.W .3d 723, 736–37 (Tex. App.—Houston [1st Dist.] 2009, no pet.) (conc luding that City was “conduit of fe d era l funds,” “no service s wer e provided direc tly to the City ,” and that section 271.152 did not apply and aff irming trial court’s order g ranting the City ’s plea to jurisdiction).

I t was MRSW ’s burden to aff irmatively establish or raise a fac t issue that immunit y had been waived by “cle ar and unambig uous lang uag e.” See Tooke , 197 S.W .3d at 328 n.2; Miranda , 133 S.W .3d at 228

. The undisput ed evidence showed t hat M RSW provided services to DPS, not NCTCOG. Ba sed upon this evidenc e and section 271.152’s plain lang uag e, we conclude that MRSW did not establish or raise a fac t issue conce rning waiver of immunit y under chapte r 271. We sustain NCTCOG’s third issue.

CONCLUSION

For these rea sons, we reve rse the trial court’s order deny ing NCTCOG’s plea to the jurisdiction and rende r judg ment dismiss ing MRSW’s claims ag ainst NCTCOG.
11__________________________________________ Melissa Goodwin, Jus tice Be fore Chief J ustice Jones, J ustices Goodwin and F ield Concurring Opinion by Chief J ustice Jones, joi ned by J ustices Goodwin and F ield Reverse d and Rende red Filed: June 20, 2013

12