If two Texas groundwater districts both annex the same land, which one gets to regulate and tax it?

TX AG Opinion GA-0795: Which district controls land annexed by two water districts at once?

Plain-English summary

A state representative asked who has jurisdiction when two water districts, each with the powers of a groundwater conservation district, both annex the same land using the two different annexation procedures in chapter 36 of the Water Code. Chapter 36 offers two routes. Under sections 36.321 through 36.324, a district may add a single landowner's tract on that owner's petition, with no election required. Under sections 36.325 through 36.328, a district may annex territory on a petition signed by the landowners, but the annexation "is not final until ratified by a majority vote of the voters in the territory to be added."

The dispute involved about 14,202 acres in eastern Caldwell County that, before these events, were in no groundwater district. In October 2007, landowners petitioned the Gonzales County Underground Water Conservation District to annex 77,440 acres (which included those 14,202 acres) under the petition-and-election route; that district's board approved the annexation in December 2007 and voters ratified it in May 2008. But in February and March 2008, after the first district had started its process but before the ratification election, thirteen landowners petitioned the Plum Creek Conservation District to annex their tracts (the 14,202 acres) under the individual-petition route, which the Plum Creek board approved with no election. Both districts then claimed authority to regulate and tax the same land.

The Attorney General started from the rule that two governmental entities cannot both have jurisdiction over the same territory for the same purpose, and since both were chapter 36 districts, the overlap could not stand. The harder question was which district won. Under the common-law "first-in-time" rule, the first entity to begin annexing unclaimed territory gets exclusive jurisdiction, which would favor the first district. But that rule applies mainly as a gap-filler when a statute does not resolve the matter, and here section 36.328 says a petition-and-election annexation "is not final" until ratified. A court could read that to mean the first district had no jurisdiction yet when the second district annexed the land by individual petition, so the second district validly took the then-unclaimed territory first. Finding no Texas case on point and calling this a question of first impression, the Attorney General concluded it could not predict how a court would rule and therefore could not definitively answer the question.

Currency note

This opinion was issued in 2010. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Chapter 36 of the Water Code and its annexation procedures have been amended since 2010, and a court may since have addressed competing district annexations. Confirm the current statutes and case law before relying on anything below.

Who this opinion affected (as of 2010)

Groundwater conservation districts: The opinion warned them that racing to annex the same unclaimed land by different chapter 36 methods could produce a genuinely unsettled jurisdictional dispute, because the first-in-time rule's application to competing district annexations was undecided.

Landowners in the disputed area: The opinion meant it was unclear which district could regulate their groundwater and levy taxes on their land, leaving their status uncertain pending a court ruling or legislation.

The Legislature: The opinion implicitly flagged a gap, since chapter 36 did not clearly resolve which annexation method prevails when two districts claim the same territory.

Common questions

Can two groundwater districts both regulate the same land?
No. The opinion applied the rule that two governmental entities cannot exist over the same territory for the same purpose, so only one chapter 36 district could end up with the 14,202 acres.

What is the "first-in-time" rule?
It is a common-law rule that the first governmental entity to begin annexation procedures over unclaimed territory gets exclusive jurisdiction. Courts have used it mainly for municipal annexations and as a gap-filler when a statute does not resolve the question.

Why might the second district win even though it started later?
Because a petition-and-election annexation "is not final" until ratified by voters. A court could find the first district had no jurisdiction until its May 2008 ratification, so the second district's earlier individual-petition annexation validly claimed the land first.

Did the opinion pick a winner?
No. The Attorney General said this was an apparent question of first impression with no Texas case on point, and it could not predict how a court would rule, so it could not definitively answer.

Background and statutory framework

Chapter 36 of the Water Code provides two annexation methods for a groundwater conservation district. Section 36.321 permits annexing land on the petition of its owner, which the district's board may approve if advantageous to both (section 36.323(a)). Sections 36.325 through 36.328 permit annexing territory on a petition signed by a majority of the landowners (or at least 50 if there are more than 50), after hearings and a benefit finding (sections 36.325(b), 36.326, 36.327), but "[a]nnexation of the territory is not final until ratified by a majority vote of the voters in the territory to be added" (section 36.328(a)).

The Attorney General applied the principle that two governmental entities may not exist over the same territory for the same purpose (Glasscock Underground Water Conservation Dist. v. Pruitt, 915 S.W.2d 577, 584 (Tex. App.—El Paso 1996, no writ)). Historically, the common-law first-in-time rule governed competing claims to property in the absence of a controlling statute (City of Roanoke v. Town of Westlake, 111 S.W.3d 617, 630 (Tex. App.—Fort Worth 2003, pet. denied); State v. Baker, 40 S.W.2d 41, 42-43 (Tex. 1931)), giving the first entity to begin annexing unclaimed territory exclusive jurisdiction (City of Cresson v. City of Granbury, 245 S.W.3d 61, 65 (Tex. App.—Fort Worth 2008, pet. denied), citing City of San Antonio v. City of Boerne, 111 S.W.3d 22, 27 (Tex. 2003)). But City of Cresson suggested the rule should apply only as a gap-filler when the statutory scheme does not adequately resolve the matter. Because section 36.328 says a petition-and-election annexation is not final until ratified, a court could conclude the first district had no jurisdiction when the second district annexed by individual petition, making the second annexation valid. With no Texas case squarely on point, the Attorney General treated the issue as one of first impression and declined to predict the outcome.

Citations

Statutes:

• Tex. Water Code Ann. §§ 36.321, 36.323(a), 36.325, 36.325(b), 36.326, 36.327, 36.328(a) (Vernon 2008)

Cases:

• Glasscock Underground Water Conservation Dist. v. Pruitt, 915 S.W.2d 577 (Tex. App.—El Paso 1996, no writ)
• City of Roanoke v. Town of Westlake, 111 S.W.3d 617 (Tex. App.—Fort Worth 2003, pet. denied)
• State v. Baker, 40 S.W.2d 41 (Tex. 1931)
• City of Cresson v. City of Granbury, 245 S.W.3d 61 (Tex. App.—Fort Worth 2008, pet. denied)
• City of San Antonio v. City of Boerne, 111 S.W.3d 22 (Tex. 2003)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/greg-abbott/ga-0795
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/2010/ga0795.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

ATTORNEY GENERAL OF TEXAS

GREG ABBOTT

August 27, 2010

The Honorable Patrick M. Rose
Chair, Committee on Human Services
Texas House of Representatives
Post Office Box 2910
Austin, Texas 78768-2910

Opinion No. GA-0795

Re: Jurisdiction over land that is annexed by two separate special districts (RQ-0812-GA)

Dear Representative Rose:

You ask about the jurisdiction of two water districts, each of which has the power of a groundwater conservation district, over land annexed by both districts under the two separate annexation procedures provided in chapter 36 of the Water Code. [Footnote 1: Request Letter at 1-2 (available at http://www.texasattorneygeneral.gov).]

Under two separate procedures described in chapter 36, a groundwater conservation district may add territory to the district by annexation if requested to do so by landowners. One procedure, authorized by section 36.321, permits annexation of land pursuant to a petition of the owner of that land. See TEX. WATER CODE ANN. § 36.321 (Vernon 2008). After hearing and considering the petition, the district's board of directors may add the land described in the petition if it is advantageous to the petitioner and the district. See id. § 36.323(a). A second procedure, authorized by section 36.325, permits annexation of territory pursuant to a petition executed by landowners in the territory, subject to approval at an election held for that purpose. See id. §§ 36.325, .328. Such a petition "must be signed by: (1) a majority of the landowners in the territory; [or] (2) at least 50 landowners if the number of landowners is more than 50." Id. § 36.325(b). After holding hearings and finding that the addition would benefit the district and the territory, the district may add all or part of the territory. See id. §§ 36.326, .327. However, "[a]nnexation of the territory is not final until ratified by a majority vote of the voters in the territory to be added." Id. § 36.328(a).

You state that the particular annexation giving rise to your inquiry involves territory in eastern Caldwell County that was not, before the competing annexations, within the jurisdiction or regulatory authority of any groundwater district. See Request Letter at 1. In October 2007, landowners petitioned the Gonzales County Underground Water Conservation District ("GCUWCD") [Footnote 2: The GCUWCD is a groundwater conservation district created under the general laws pursuant to an order of the Texas Commission on Environmental Quality. See Brief from J.D. Head, Fritz, Byrne, Head & Harrison, PLLC, Attorney for the GCUWCD at 2 (Aug. 26, 2009) [hereinafter GCUWCD Brief]. Thus, it has the powers of a groundwater conservation district under chapter 36 of the Water Code. See id. The GCUWCD originally included eighty-five percent of the land in Gonzales County, excluding land in the southeastern part of the county bordering Lavaca and DeWitt Counties. See id.] to annex 77,440 acres in the unregulated territory contiguous to GCUWCD's boundaries pursuant to Water Code section 36.325. See id. In December 2007, the GCUWCD board of directors approved the annexation and residents of the affected territory approved the annexation by an affirmative vote at a ratification election in May 2008. See id. In February and March 2008, after commencement of the GCUWCD annexation process but before the May 2008 ratification election, thirteen separate landowners presented individual petitions to the Plum Creek Conservation District ("PCCD") [Footnote 3: The PCCD was created by special legislation initially as a water control and improvement district and later granted the powers of an underground water district under former chapter 52 of the Water Code. See Act of Apr. 17, 1957, 55th Leg., R.S., ch. 126, 1957 Tex. Gen. Laws 267, as amended by Act of May 3, 1973, 63d Leg., R.S., ch. 133, 1973 Tex. Gen. Laws 283; Act of May 27, 1981, 67th Leg., R.S., ch. 659, 1981 Tex. Gen. Laws 2499; Act of May 20, 1989, 71st Leg., R.S., ch. 952, 1989 Tex. Gen. Laws 4018. The PCCD covers parts of Caldwell and Hays Counties. See Plum Creek Conservation District, PCCD History, available at http://www.pccd.org/about.htm (last visited Aug. 23, 2010).] requesting annexation of their respective properties, totaling 14,202 acres. No ratification election was statutorily required, and the PCCD board of directors approved the thirteen petitions. Id. "The entirety of these 14,202 acres, newly annexed by petition into the PCCD in February-March 2008, was included in the 77,440 acres previously scheduled, and subsequently approved, in the May 2008 [GCUWCD] confirmation election." Id. Both GCUWCD and PCCD now "claim . . . authority to regulate the properties for purposes of groundwater conservation, and both districts intend to levy taxes on the property." Id.

As a matter of general law, "two governmental entities may not exist at the same time over the same territory for the same purpose." Glasscock Underground Water Conservation Dist. v. Pruitt, 915 S.W.2d 577, 584 (Tex. App.—El Paso 1996, no writ) (emphasis added). Because both GCUWCD and the PCCD are chapter 36 districts, they operate for the same purpose and thus, the 14,202 acres at issue here may not, under the language of Pruitt and in the absence of legislation to the contrary, be included within the territory of both districts. You ask that we determine which of the two districts has jurisdiction over the dually-annexed land, i.e., the same 14,202 acres.

Historically, in the absence of a controlling statutory scheme, the common-law first-in-time rule governed competing claims to property. City of Roanoke v. Town of Westlake, 111 S.W.3d 617, 630 (Tex. App.—Fort Worth 2003, pet. denied); see also State v. Baker, 40 S.W.2d 41, 42-43 (Tex. 1931) (applying first-in-time rule to two different types of school districts established over the same territory). While not limited to cities, the rule was primarily utilized in the context of municipal annexations. Under this rule, the first governmental entity to begin annexation procedures on unclaimed territory obtained exclusive jurisdiction over that property. City of Cresson v. City of Granbury, 245 S.W.3d 61, 65 (Tex. App.—Fort Worth 2008, pet. denied) (citing City of San Antonio v. City of Boerne, 111 S.W.3d 22, 27 (Tex. 2003)). In the present situation, GCUWCD received an annexation petition in October 2007, and in December 2007, it approved the petition and called an election to ratify the annexation. See Request Letter at 1. PCCD received and approved annexation petitions covering a portion of the same territory in February and March of 2008. See id. at 2. Under the first-in-time rule, GCUWCD would appear to have acquired exclusive jurisdiction over the disputed territory for the purposes of annexation to the exclusion of PCCD.

While it is possible that a court would apply the first-in-time rule, we cannot be certain that it will. A court could read chapter 36 to address the competing claims to territory annexed under the two statutory procedures at issue and conclude that to resort to the first-in-time rule is unwarranted. See TEX. WATER CODE ANN. § 36.328(a) (Vernon 2008); see also City of Cresson, 245 S.W.3d at 67 (in the context of competing municipal claims to the same property, suggesting that the first-in-time rule should be applied only as a "gap-filler" when the statutory scheme does not adequately address which city is entitled to assert jurisdiction). Section 36.328, which applies to an annexation petition filed under section 36.325, expressly provides that "[a]nnexation of the territory is not final until ratified by a majority vote of the voters in the territory to be added." TEX. WATER CODE ANN. § 36.328(a) (Vernon 2008) (emphasis added). Because the annexation is not final until it is approved by a vote at a ratification election held for that purpose, a district that annexes territory pursuant to the section 36.325 procedure is arguably not entitled to assert jurisdiction over that territory until an election has been held and the voters have ratified the annexation. Before the section 36.325 annexation is final, if the second district proceeds under the section 36.321 annexation procedure to add the same territory, it is arguably authorized to do so because no other district has jurisdiction over the territory, including the first district. Id. §§ 36.321-.323 (authorizing annexation of land pursuant to a petition of the landowner). Consequently, when the first district then proceeds to hold its ratification election on a subsequent date, it arguably is not entitled to assert jurisdiction over the territory because the territory is already included within the second district pursuant to the section 36.321 annexation procedure.

In sum, we believe that, while a court might have a basis to apply the first-in-time rule, we cannot predict with confidence whether a court would do so here. Indeed, we believe that a court could also find that the first annexation was "not final" and that the section 36.321 annexation was therefore authorized. The briefing provided to us does not identify any Texas case squarely addressing this question, and we have found none. This appears to be a question of first impression, and given the current state of the law, we cannot predict how a Texas court would resolve this issue. As a result, we cannot definitively answer your question. See Tex. Att'y Gen. Op. No. GA-0630 (2008) at 4; accord Tex. Att'y Gen. Op. No. GA-0279 (2004) at 4-5.

SUMMARY

Whether a water district that adds territory pursuant to individual petitions of separate landowners, in compliance with Water Code sections 36.321 through 36.324, before annexation of the same territory by another groundwater district is ratified at an election under section 36.328, acquires jurisdiction over the subject territory depends on whether a court would apply the first-in-time rule to competing chapter 36 annexation claims. Applying the first-in-time rule, a court could find that the first district to initiate annexation procedures acquires jurisdiction. A court could also find that the first district to finalize the annexation acquires jurisdiction. This office cannot predict, in the apparent absence of judicial precedent, how a Texas court would resolve this issue. As a result, we cannot definitively answer your question.

Very truly yours,

GREG ABBOTT
Attorney General of Texas

DANIEL T. HODGE
First Assistant Attorney General

NANCY S. FULLER
Chair, Opinion Committee

Rick Gilpin
Assistant Attorney General, Opinion Committee