Opinion ID: 895256
Heading Depth: 2
Heading Rank: 3

Heading: Reserved Powers Doctrine

Text: The Authority next argues that, should we interpret the Agreements to impose an ongoing obligation to submit bond proposals in each future election, the Agreements would interfere with substantive government functions, violating the reserved powers doctrine. See State ex rel. City of Jasper v. Gulf States Utils. Co., 144 Tex. 184, 189 S.W.2d 693, 698 (1945). The Authority maintains that a contract which purports to bind all future boards of directors to include certain propositions in all future elections would abrogate [its] discretion regarding its handling of future bond elections. See Todd v. Helton, 495 S.W.2d 213, 220 (Tex.1973) (noting that elections are essentially the exercise of political power, and exempt from judicial interference); State ex rel. Edwards v. Reyna, 160 Tex. 404, 333 S.W.2d 832, 833 (1960) ([T]he conduct of elections is primarily a matter for legislative regulation and control.). Certain powers are conferred on government entities for public purposes, and can neither be delegated nor bartered away. Jasper, 189 S.W.2d at 698. Government entities cannot cede ... away [such powers] through contracts with others so as to disable them from the performance of their public duties. Id.; see also Brenham v. Brenham Water Co., 67 Tex. 542, 4 S.W. 143, 149 (1887) ([Municipal] corporations may make authorized contracts, but they have no power, as a party, to make contracts or pass bylaws which shall cede away, control or embarrass their legislative or governmental powers, or which shall disable them from performing their public duties.) (quotations omitted). However, it does not apply to the case at hand. Here, the Authority contracted not to bargain away future power, but to pay an invoice for services rendered if and when funds become available through voter-approved bonds. Nor does the present situation suggest improper impediments to the Authority's governmental operations. In Clear Lake City Water Authority v. Clear Lake Utilities, we held that an agreement between the Authority and a utility company was not binding because it had the effect of potentially controlling and embarrassing [the] Authority in the exercise of its governmental powers. Clear Lake City Water Auth. v. Clear Lake Utils. Co., 549 S.W.2d 385, 392 (Tex.1977). In that case, the agreement obligated the Authority to meet all water and sewage treatment needs for the Utilities, while precluding it from extending those services directly to the landowners themselves, under terms and rates that it deems best. Id. Thus we found that the Authority had bargained away its governmental power to determine whether, on any particular date, it is in the best interests of all of its customers and the public in general, to extend water and sewer service to a particular person or entity. Id. In this case, the Authority's contractual obligation to include a bond reimbursement proposition in future elections does not affect the performance of its public duties. It neither hampers nor embarrasses the manner in which the Authority holds electionsincluding the time, place, order, number of propositions, or even whether it chooses to hold a bond election at all. Nor does it control or impede the Authority's power to determine how and to whom it will extend water services. See id. We therefore reject the Authority's contention that the Agreements run afoul of the reserved powers doctrine.