ADMINISTRATIVE HEARINGS BEFORE

GROUNDWATER CONSERVATION

DISTRICTS

J.D. Head

Managing Partner

Fritz, Byrne, Head & Harrison, PLLC

98 San Jacinto Blvd., Suite 2000

Austin, TX 78701

TEL: 512/476-2020

E-MAIL: jdhead@fbhh.com

SUBCHAPTER M OF CHAPTER 36,

TEX. WATER CODE

ADDRESSES NOTICE AND HEARING PROCEDURES FOR PERMIT AND PERMIT AMENDMENT APPLICATIONS

- ADDED TO CHAPTER 36 IN 2005 BY HB 1763

- SOMEWHAT CONFUSING BECAUSE OF FAILURE TO CLEARLY DISTINGUISH BETWEEN PROCEDURES FOR CONTESTED AND UNCONTESTED HEARINGS

§ 36.415 – GROUNDWATER CONSERVATION DISTRICTS (GCDs) WERE REQUIRED TO ADOPT PROCEDURAL RULES TO IMPLEMENT SUBCHAPTER M

GCDs MAY ADOPT NOTICE AND HEARING PROCEDURES IN ADDITION TO THOSE PROVIDED IN STATUTE

CONTESTED CASES

BY RULE, A DISTRICT SHALL:

(1) DEFINE UNDER WHICH CIRCUMSTANCES AN APPLICATION IS CONSIDERED CONTESTED, AND

(2) LIMIT PARTICIPATION IN A HEARING ON A CONTESTED APPLICATION TO PERSONS WHO HAVE A PERSONAL JUSTICIABLE INTEREST RELATED TO A LEGAL RIGHT, DUTY, PRIVILEGE, POWER OR ECONOMIC INTEREST THAT IS WITHIN THE DISTRICT’S REGULATORY AUTHORITY AND AFFECTED BY A PERMIT OR PERMIT AMENDMENT APPLICATION – NOT INCLUDING PERSONS WHO HAVE AN INTEREST COMMON TO MEMBERS OF GENERAL PUBLIC

GCD CAN PROVIDE, BY RULE, THAT CERTAIN PERMITS OR PERMIT AMENDMENTS DO NOT

REQUIRE A HEARING

- GENERAL MANAGER (GM) MAY ACT ON APPLICATION, OR

- BOARD ACTS ON APPLICATION AT REGULAR BOARD MEETING

§ 36.114

TWO TYPES OF PERMIT HEARINGS

- UNCONTESTED

- CONTESTED

§ 36.403 – GM OR BOARD MAY SCHEDULE A HEARING ON A PERMIT APPLICATION

MAY SCHEDULE MORE THAN ONE APPLICATION FOR CONSIDERATION AT A HEARING – VERY COMMON IN ACTIVE GCDs

HEARING MAY BE HELD IN CONJUNCTION WITH REGULARLY SCHEDULED BOARD MEETING – LIMITS AMOUNT OF TIME A GCD BOARD MUST MEET

§ 36.404 – NOTICE

NOTICE OF HEARING INCLUDES:

- NAME OF APPLICANT

- ADDRESS AND LOCATION OF WELL

- BRIEF EXPLANATION OF PROPOSED PERMIT – AMOUNT OF GROUNDWATER REQUESTED AND PURPOSE OF USE

- TIME, DATE AND LOCATION OF HEARING

NO LATER THAN THE 10TH DAY BEFORE HEARING:

- POST NOTICE AT DISTRICT OFFICE

- PROVIDE NOTICE TO COUNTY CLERK FOR EACH COUNTY IN DISTRICT

- PROVIDE NOTICE BY MAIL TO:

- APPLICANT

- ANY PERSON WHO HAS REQUESTED NOTICE

- ANY OTHER PERSON ENTITLED TO NOTICE UNDER DISTRICT RULES

§ 36.406 - HEARING PROCEDURES

- HEARING MUST BE CONDUCTED BY

(1) QUORUM OF THE BOARD; OR

(2) INDIVIDUAL WHOM BOARD HAS DELEGATED IN WRITING RESPONSIBILITY TO PRESIDE AS HEARINGS EXAMINER

BOARD PRESIDENT OR HEARINGS EXAMINER SHALL SERVE AS PRESIDING OFFICER

§ 36.406 - POWERS OF PRESIDING OFFICER

- CONVENE HEARING

- SET ADDITIONAL HEARING DATES

- DESIGNATE PARTIES REGARDING A CONTESTED APPLICATION

- ESTABLISH ORDER FOR PRESENTATION OF EVIDENCE

- ADMINISTER OATHS

- EXAMINE PERSONS PRESENTING TESTIMONY

- ENSURE THAT INFORMATION AND TESTIMONY ARE INTRODUCED AS CONVENIENTLY AND EXPEDITIOUSLY AS POSSIBLE WITHOUT PREJUDICING RIGHTS OF PARTIES

- PRESCRIBE REASONABLE TIME LIMITS FOR TESTIMONY AND PRESENTATION OF EVIDENCE (VERY GOOD IDEA IN COMPLEX, MULTI-PARTY HEARING)

§ 36.406 - POWERS OF PRESIDING OFFICER – CONT’D

DISTRICT MAY ALLOW ANYONE TO COMMENT ON UNCONTESTED APPLICATION

MAY ALLOW WRITTEN SWORN TESTIMONY

MAY EXCLUDE WRITTEN TESTIMONY IF NO OPPORTUNITY FOR CROSS EXAMINATION BY PARTY TO CONTESTED HEARING

MAY ALLOW TESTIMONY TO BE SUPPLEMENTED WITH NOTICE TO ALL COMMENTERS AND PARTIES - PERSONS MAY RESPOND TO SUPPLEMENTAL TESTIMONY

MAY ORDER PARTIES TO CONTESTED CASE HEARING TO MEDIATION

§ 36.408 – RECORDING OF HEARING

- IF CONTESTED HEARING – A PARTY CAN REQUEST A COURT REPORTER TRANSCRIBE THE HEARING – PRESIDING OFFICER CAN ASSESS COSTS

- OTHERWISE – PRESIDING OFFICER SHALL KEEP A RECORD OF EACH HEARING IN FORM OF VIDEO, AUDIO OR A COURT REPORTER

- IN UNCONTESTED HEARING, PRESIDING OFFICER MAY SUBSTITUTE MINUTES OR § 36.410 REPORT AS METHOD OF RECORDING

§ 36.410 – THE REPORT

- PRESIDING OFFICER SUBMITS A REPORT TO BOARD NOT LATER THAN 30TH DAY AFTER HEARING CONCLUDED

REPORT INCLUDES:

- SUMMARY OF SUBJECT MATTER OF HEARING

- SUMMARY OF EVIDENCE OR PUBLIC COMMENTS RECEIVED

- PRESIDING OFFICER’S RECOMMENDATION

APPLICANT, PARTIES OR COMMENTERS MAY SUBMIT WRITTEN EXCEPTIONS TO THE BOARD

IF HEARING CONDUCTED BY A QUORUM AND IF PRESIDING OFFICER HAS RECORD OF HEARING, THE PRESIDING OFFICER SHALL DECIDE WHETHER TO PREPARE A REPORT TO THE BOARD

BOARD ACTION – NO LATER THAN 60 DAYS AFTER DATE FINAL HEARING IS CONCLUDED

§ 36.412 – REQUEST FOR REHEARING OR FINDINGS AND CONCLUSIONS

AN APPLICANT IN A CONTESTED OR UNCONTESTED HEARING OR A PARTY TO A CONTESTED CASE MAY ADMINISTRATIVELY APPEAL THE DECISION BY REQUESTING FINDINGS AND CONCLUSIONS OR A REHEARING BEFORE THE BOARD

BOARD MUST MAKE WRITTEN FINDINGS AND CONCLUSIONS, IF TIMELY REQUEST FILED, WITHIN 35 DAYS OF REQUEST.

A PERSON WHO RECEIVES A CERTIFIED COPY OF FINDINGS AND CONCLUSIONS MAY REQUEST A REHEARING NOT LATER THAN 20TH DAY AFTER BOARD ISSUES FINDINGS AND CONCLUSIONS

IF REQUEST GRANTED, BOARD SHALL SCHEDULE HEARING WITHING 45 DAYS AFTER REQUEST GRANTED

REQUEST OVERRULED BY OPERATION OF LAW 91 DAYS AFTER DATE OF REQUEST

SENATE BILL 693 – SOAH HEARINGS

RELATES TO PERMIT HEARINGS CONDUCTED BY A GCD AND STATE OFFICE OF ADMINISTRATIVE HEARINGS (SOAH)

AUTHOR’S INTENT:

- PROVIDE OBJECTIVITY AND BALANCE IN PERMITTING PROCESS

- PROVIDE DISTRICTS WITH NEUTRAL 3RD PARTY EXAMINERS BETTER EQUIPPED TO HANDLE ADMINISTRATIVE ISSUES ASSOCIATED WITH CONTESTED CASE HEARINGS

- MORE ECONOMICAL FOR GCDs

SENATE BILL 693 – SOAH

HEARING (CONT’D) KEY POINTS:

- GCD MAY ADOPT RULES FOR HEARINGS THAT ARE CONSISTENT WITH PROCEDURAL RULES OF STATE OFFICE OF ADMINISTRATIVE HEARINGS

- IF APPLICANT OR OTHER PARTY TO CONTESTED CASE REQUESTS A HEARING BEFORE SOAH, GCD MUST CONTRACT WITH SOAH TO CONDUCT HEARING

- REQUEST FOR HEARING BEFORE SOAH MUST BE MADE NOT LATER THAN 14 DAYS BEFORE DATE OF EVIDENTIARY HEARING – OR OTHER DEADLINE BY GCD RULE

- GCD CHOSES LOCATION OF SOAH HEARING – CAN BE IN AUSTIN OR IN DISTRICT

SENATE BILL 693 – SOAH HEARINGS (CONT’D)

PARTY REQUESTING THE SOAH HEARING PAYS COSTS ASSOCIATED WITH CONTRACT FOR HEARING – MONEY DEPOSITED WITH GCD PRIOR TO HEARING – EXCESS MONEY REFUNDED.

IF SOAH PRESIDES OVER HEARING, GCD BOARD MAKES FINAL DECISION BASED ON SOAH’S PROPOSAL FOR DECISION. (BOARD NOT REQUIRED TO ADOPT SOAH RECOMMENDATION.)

GCDs SHALL ADOPT RULES TO:

(1) ESTABLISH A PROCEDURE FOR PRELIMINARY AND EVIDENTIARY HEARINGS.

(2) ALLOW THE PRESIDING OFFICER, AT THE PRELIMINARY HEARING, TO DETERMINE A PARTY’S RIGHTS TO PARTICIPATE IN A HEARING.

(3) SET A DEADLINE FOR A PARTY TO FILE A REQUEST TO REFER A CONTESTED CASE TO SOAH.

GONZALES COUNTY UNDERGROUND WATER CONSERVATION DISTRICT ADMINISTRATIVE HEARINGS

- SAN ANTONIO WATER SYSTEM PERMIT HEARING

- GM OBJECTED TO PERMITS

- BOARD DESIGNATED HEARINGS EXAMINER – SAWS PAID COST OF HEARINGS EXAMINER

- HEARINGS EXAMINER CONDUCTED PARTY STATUS HEARING AND FULL BOARD VOTED ON PARTIES

- PARTIES INCLUDED GM, SSLGC, CRWA, WPA, CITY OF NIXON, CITY OF SMILEY

- HEARINGS EXAMINER CONVENED PREHEARING CONFERENCE WITH ALL PARTIES TO SET DISCOVERY SCHEDULE

- MULTIPLE MEDIATION SESSIONS

- ALL PARTIES FILED WRITTEN TESTIMONY

- NUMEROUS DEPOSITIONS

- HEARINGS EXAMINER PRESIDED OVER 6 DAY HEARING

- 13 WITNESSES

- 1,500 PAGES OF HEARING TRANSCRIPT

- 2,500 PAGES OF EXHIBITS AT HEARING

- 270 PAGES OF BRIEFING

- 175 PAGES OF HEARINGS OFFICER REPORT

- BOARD VOTED 3 TO 2 TO ISSUE PERMITS TO SAWS

- BOARD DECISION IS ON APPEAL

- 13TH COURT OF APPEALS DECISION PENDING

SAWS HEARING INVOLVED COMPLEX EVIDENCE ON DRAWDOWN MODELS

PRIMARY ISSUES: - WOULD DRAWDOWN FROM SAWS PUMPING CAUSE

MORE THAN 100 FEET OF DRAWDOWN IN CARRIZO AQUIFER

- WOULD SAWS PUMPING IMPACT EXISTING WELLS - WAS THERE A NEED FOR WATER IN SAWS SERVICE

AREA * TESTIMONY ON DRAWDOWN MODELS WAS LENGTHY

AND MIND NUMBING

- GCUWCD -

3 EXPORTER PERMIT APPLICATIONS

CURRENTLY PENDING

- CANYON REGIONAL WATER

AUTHORITY – 4,400 ACRE FEET

- HAYS CALDWELL PUBLIC UTILITY

AGENCY – 10,300 ACRE FEET

- TEXAS WATER ALLIANCE – 15,000 ACRE

FEET

ALL THREE APPLICATIONS PROTESTED

- APPLICANTS ARE PROTESTING EACH OTHERS PERMITS

- NUMEROUS CITIZENS OPPOSE PERMITS

- BOARD DESIGNATED OUTSIDE HEARINGS EXAMINER

- GM DID NOT OPPOSE PERMITS OR SEEK PARTY STATUS

- HEARING ON PARTY STATUS BEFORE BOARD CONVENED AT 1 P.M. AND ENDED AT 11:30 P.M. – OVER 10 HOURS!

- COURT REPORTER LEFT BEFORE END OF HEARING

BOARD VOTED ON INDIVIDUAL PARTY

STATUS FOR EACH APPLICATION – BASED

ON HEARINGS EXAMINER’S

RECOMMENDATIONS

- ALL APPLICATIONS CURRENTLY IN

MEDIATION

- HEARINGS EXAMINER WILL CONDUCT

HEARINGS AND PREPARE REPORT TO

BOARD

OBSERVATIONS, ISSUES AND RECOMMENDATIONS ON ADMINISTRATIVE HEARINGS

- IF GM IS AUTOMATIC PARTY IN HOTLY CONTESTED CASE, THIS CAN BE EXTREMELY TIME CONSUMING FOR GM

- HAVING A GCD BOARD BEING A PROTESTING PARTY IS VERY PROBLEMATIC

- IF QUORUM OF BOARD HEARS A CONTESTED CASE, THE PRESIDING OFFICER SHOULD GET LEGAL ASSISTANCE

- IF BOARD DENIES PERMIT WITHOUT A HEARING OFFICER’S REPORT, IT MAY HAVE TO PREPARE FINDINGS AND CONCLUSIONS JUSTIFYING ITS ACTION

OBSERVATIONS, ISSUES AND RECOMMENDATIONS ON ADMINISTRATIVE HEARINGS (CONT’D)

- CONSIDER HAVING PUBLIC NOTICE SPELL OUT HOW TO REQUEST A CONTESTED CASE HEARING

- SEND PARTIES TO MEDIATION!!

- GCDs RULES REGARDING HEARINGS RUN THE GAMUT FROM NON-COMPLIANCE WITH SUBCHAPTER M OF CHAPTER 36 TO VERY DETAILED PROCEDURES

- ADOPT NEW RULES TO IMPLEMENT SB 693

- CONSIDER ADOPTING RULE INDICATING WHEN MATTER BECOMES CONTESTED WITH RESPECT TO EX PARTE COMMUNICATIONS

“EX PARTE” COMMUNICATION

MEANS A COMMUNICATION

WITH A DECISION MAKER BY

ONE PARTY TO A MATTER

WITHOUT NOTICE TO THE

OTHER PARTY OR PARTIES TO

THE MATTER

RULE 3.05 OF THE TEXAS DISCIPLINARY RULES OF PROFESSIONAL CONDUCT

“MAINTAINING IMPARTIALITY OF TRIBUNAL

A LAWYER SHALL NOT:

(a) EXCEPT AS OTHERWISE PERMITTED BY LAW AND NOT PROHIBITED BY APPLICABLE RULES OF PRACTICE OR PROCEDURE, COMMUNICATE OR CAUSE ANOTHER TO COMMUNICATE EX PARTE WITH A TRIBUNAL FOR THE PURPOSE OF INFLUENCING THAT ENTITY OR PERSON CONCERNING A PENDING MATTER OTHER THAN:

(1) IN THE COURSE OF OFFICIAL PROCEEDINGS IN THE CAUSE;

(2) IN WRITING IF HE PROMPTLY DELIVERS A COPY OF THE WRITING TO OPPOSING COUNSEL OR THE ADVERSE PARTY IF HE IS NOT REPRESENTED BY A LAWYER;

(3) ORALLY UPON ADEQUATE NOTICE TO OPPOSING COUNSEL OR TO THE ADVERSE PARTY IF HE IS NOT REPRESENTED BY A LAWYER.

(b) FOR PURPOSES OF THIS RULE:

(1) “MATTER” HAS THE MEANINGS ASCRIBED BY IT IN RULE 1.10(f) OF THESE RULES;

(2) A MATTER IS “PENDING” BEFORE A PARTICULAR TRIBUNAL EITHER WHEN THAT ENTITY HAS BEEN SELECTED TO DETERMINE THE MATTER OR WHEN IT IS REASONABLY FORESEEABLE THAT THAT ENTITY WILL BE SO SELECTED.

RULE 1.10(f) PROVIDES THAT THE TERM “MATTER” DOES NOT INCLUDE REGULATION-MAKING OR RULE-MAKING PROCEEDINGS OR ASSIGNMENTS, BUT THE TERM INCLUDES THE FOLLOWING:

(1) ANY ADJUDICATORY PROCEEDING, APPLICATION, REQUEST FOR A RULING OR OTHER DETERMINATION . . . INVOLVING A SPECIFIC PARTY OR PARTIES

CHAPTER 36 TEX. WATER CODE DOES NOT CONTAIN ANY EXPLICIT PROHIBITION OF EX PARTE COMMUNICATIONS

BUT

CASES HEARD BY STATE OFFICE OF ADMINISTRATIVE HEARINGS ARE CONTROLLED BY CERTAIN SECTIONS OF CHAPTER 2001, GOV’T CODE – INCLUDING A PROHIBITION OF EX PARTE COMMUNICATIONS.

SECTION 2001.061(a), TEX. GOV’T CODE PROVIDES:

(a) UNLESS REQUIRED FOR THE DISPOSITION OF AN EX PARTE MATTER AUTHORIZED BY LAW, A MEMBER OR EMPLOYEE OF A STATE AGENCY ASSIGNED TO RENDER A DECISION OR TO MAKE FINDINGS OF FACT AND CONCLUSIONS OF LAW IN A CONTESTED CASE MAY NOT DIRECTLY OR INDIRECTLY COMMUNICATE IN CONNECTION WITH AN ISSUE OF FACT OR LAW WITH A STATE AGENCY, PERSON, PARTY, OR A REPRESENTATIVE OF THOSE ENTITIES, EXCEPT ON NOTICE AND OPPORTUNITY FOR EACH PARTY TO PARTICIPATE.

(b) A STATE AGENCY MEMBER MAY COMMUNICATE EX PARTE WITH ANOTHER MEMBER OF THE AGENCY UNLESS PROHIBITED BY OTHER LAW.

(c) UNDER SECTION 2001.090, A MEMBER OR EMPLOYEE OF A STATE AGENCY ASSIGNED TO RENDER A DECISION OR TO MAKE FINDINGS OF FACT AND CONCLUSIONS OF LAW IN A CONTESTED CASE MAY COMMUNICATE EX PARTE WITH AN AGENCY EMPLOYEE WHO HAS NOT PARTICIPATED IN A HEARING IN THE CASE FOR THE PURPOSE OF USING THE SPECIAL SKILLS OR KNOWLEDGE OF THE AGENCY AND ITS STAFF IN EVALUATING THE EVIDENCE.

THIS PROVISION GENERALLY PROHIBITS CERTAIN EX PARTE COMMUNICATIONS IN CONNECTION WITH AN ISSUE OF FACT OR LAW IN A CONTESTED CASE.

THE EX PARTE PROHIBITION

APPLIES TO COMMUNICATION

WITH THE ULTIMATE DECISION

MAKER AND HE/SHE WHO

MAKES FINDINGS OF FACT AND

CONCLUSIONS OF LAW

- THE BOARD

- THE HEARINGS EXAMINER

OR SOAH ALJ

THE RULE 3.05 EX PARTE PROHIBITION APPLIES TO LAWYERS

IS APPLICABLE TO ANY PENDING MATTER BEFORE A GCD BOARD OR SOAH

THE GOV’T CODE EX PARTE PROHIBITION APPLIES MORE BROADLY – TO PARTIES, PERSONS OR REPRESENTATIVES

IS APPLICABLE TO CASES REFERRED BY A GCD TO SOAH

APPLIES TO SOAH JUDGE AND GCD BOARD IN A CONTESTED CASE

MANY GCD PROCEDURAL RULES SPECIFICALLY PROHIBITING EX PARTE COMMUNICATIONS IN CONTESTED CASE HEARINGS BEFORE THE BOARD

RULES TYPICALLY APPLY TO ALL PARTIES AND PERSONS

GCD EX PARTE PROHIBITION RULE CAN BE USED TO CURTAIL DISCUSSION OF CONTESTED PERMITS IN PUBLIC COMMENT SESSION OF AGENDA