After quietly launching legal action against a citizen-led petition effort in early December, SAWS and the City of San Antonio announced in a press release on Monday, January 25, that they have abruptly ended their lawsuit against the SAWS Act PAC, while falsely claiming that the petitioners did not collect enough valid signatures and had run out of time to do so. The SAWS Act charter amendment petition seeks to limit the CEO’s salary, enforce term limits on the Board of Trustees, prohibit SAWS from engaging in lobbying activities, and would require an independent audit of the $3 billion Vista Ridge pipeline. The lawsuit came on the heels of a separate legal action by CPS Energy that effectively nullified the Recall CPS petition led by another citizens’ coalition which sought changes in governance at the electric utility as well as the shuttering of the Spruce coal-fired power plant. The original suit filed by SAWS in a Travis County court in early January alleged a negative impact from the petition language on SAWS bondholders.
On January 19, attorneys Michael O’Donnell and Paul Trahan from a private law firm representing SAWS and the City of San Antonio, faced off in a virtual hearing against pro bono attorneys Bill Bunch and James L. Murphy, representing the citizen’s coalition of petitioners, in the 201st District Court of Judge Amy Clark Meachum in Austin.
Bunch and Murphy countered the complaint by SAWS and cross-examined witnesses during the five-hour hearing. Notably in attendance at Tuesday’s hearing was William McDaniel, a representative of the Texas Attorney General’s office, whose presence might signal an interest from state authorities in this matter.
During questioning, Murphy asked Clay Binford, a municipal bond attorney who testified under oath, whether the suit had been authorized by the San Antonio City Council. Binford replied, “No.” When asked whether the suit had been authorized by the SAWS Board of Trustees. Binford again answered, “No.”
Cross-examination revealed that the suit was brought unilaterally by Robert Puente, President/CEO of SAWS, with the intent to preemptively invalidate thousands of petition signatures already collected but not yet submitted to the city clerk. One of the petition’s provisions would, if adopted, limit Puente’s compensation to 10 times that of the lowest-paid SAWS employee, an obvious ethical conflict for Puente, an attorney and former state legislator.
The attorneys for the petitioners filed a motion for the SAWS attorneys to demonstrate their standing to sue on behalf of the City of San Antonio. Judge Meachum required the SAWS attorneys to produce this proof within a week’s time. In the closing minutes of the hearing, Meachum told the SAWS attorneys, “You have the harder part of the argument.” It now appears that SAWS and the City, rather than face a potentially embarrassing loss in court, have abandoned their legal strategy. SAWS officials are now falsely claiming that the petitioners failed to gather the necessary signatures and that time has run out to submit signatures so that the city clerk can validate these by February 11, the last day that council can place items on the May ballot. Bexar County Elections Administrator Jacque Callanen, however, told the San Antonio Report that the exact timeline for certifying petitions to be placed on that ballot was not as clear-cut as officials from SAWS or the City have claimed.
The petitioners for their part are continuing to collect signatures and are urging community members to join them in this effort so that voters can have a choice in the matter come May. It bears mentioning that the city council could simply vote to place the SAWS Act charter amendment language on the ballot and allow voters to decide. However, given the reticence towards public engagement typically shown by the mayor and city council, it is unlikely that they will take action in support of the public’s right to a referendum. The mayor, an ex-officio SAWS trustee, has said little publicly and appears either unwilling or unable to engage the public constructively on this matter.
This petition and the now-defunct Recall CPS petition effort will almost certainly become campaign issues in the May municipal election. The public will want to hear what the mayoral and city council candidates plan to do about accountability and transparency at SAWS and CPS Energy. Both utility companies have long been criticized by community groups for their lack of transparency and have traditionally displayed little interest in working with ratepayers and community members in good faith on environmental concerns or equity issues, such as fair rates. These recent legal actions to suppress citizen-led petitions—backed by tens of thousands of voters who had hoped to vote on governance matters at these publicly owned entities—are especially problematic and do serious harm to the public trust. As a result of these anti-democratic tactics by SAWS and CPS Energy, the mayor and city council incumbents could be facing a backlash from voters in May.