Texas Court of Appeals Rules SJRA Cannot Impose Water Tax on Cities

Earlier today, the Texas Court of Appeals Ninth District of Texas ruled that SJRA cannot impose a water tax on the cities of Conroe, Magnolia, and Splendora, citing the cities’ governmental immunity. The ruling also confirms that cities and MUDs are exempt to the rates the SJRA is charging related to the Groundwater Reduction Plan (GRP).  

This decision comes after a years-long battle between SJRA and the cities of Conroe, Magnolia, and Splendora that began when SJRA proposed a rate increase in 2017. By that time, water rates in Montgomery County had increased by 100%. The cities passed resolutions alleging that SJRA was overcharging for water. The City of Conroe rejected the rate increase and refused to pay it.

In response, SJRA filed a lawsuit against City of Conroe for refusing to pay the new rate, but district courts ruled that Conroe is immune from SJRA’s suit and dismissed SJRA’s case against Conroe and Magnolia. SJRA immediately appealed.

This judgment affirms the district court’s ruling that the SJRA did not have the authority to sue the cities.

“I am pleased to hear this news, especially after revelations that some Conroe officials were in negotiations with SJRA to settle the lawsuit,” says Quadvest CEO Simon Sequeira. “While Quadvest was not directly involved in this lawsuit, the results tell us what we have been saying for years – the cities of Montgomery County and Quadvest will resolve this water tax issue and we will prevail.”

Quadvest will continue to set aside all SJRA fees paid by our customers in a separate account and fully expect millions of dollars to be refunded to customers when the final verdict is rendered.


For more information contact:

Allison Trejo - Media

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