Well it’s pretty clear that we’ve touched a nerve with our stated intent to overturn the council’s anticipated decision to borrow money to cover its budget shortfall.

The city manager sent me a memo from Stan Lowry, City Attorney this morning:

MEMORANDUM

TO: Dan O’Leary, City Manager
City of Keller

FROM: Stan Lowry
Boyle & Lowry, L.L.P.
Leroy Grawunder, Jr.
McCall, Parkhurst & Horton L.L.P.

DATE: March 29, 2010

SUBJECT: Application of Charter Section 7.03 to General Obligation Refunding Bonds

The City of Keller (the “City”) is preparing to issue general obligation refunding bonds to refinance portions of its outstanding Combination Tax and Tax Increment Reinvestment Zone Revenue Certificates of Obligation, Series 2000, and Combination Tax and Tax Increment Reinvestment Zone Revenue Certificates of Obligation, Series 2001.

You have informed us that a citizen has notified you that he is planning to submit a petition pursuant to the City’s’ home rule charter to require a referendum election on the ordinance authorizing the proposed refunding bonds, and have asked what would be the effect of such petition on the issuance of the bonds. Section 7.03 of the City’s home rule charter provides that any ordinance passed by the City Council is subject to referendum if a petition, meeting the requirements of the charter, is filed.

The proposed refunding bonds would be issued pursuant to Chapter 1207, Texas Government Code. Section 1207.003, Texas Government Code (“Section1207.003”), provides that refunding bonds may be issued without an election, unless an election is required by the Texas Constitution. We are not aware of any constitutional provision that would require a municipality to hold an election with regard to the issuance of general obligation refunding bonds.

It is a recognized principal [sic] of Texas law that if there is a conflict between State law and a home rule charter provision, State law prevails. Section 1207.003 specifically authorizes a governing body to issue refunding bonds without holding an election. A home rule charter provision that requires, upon the filing of a petition, a referendum election on the ordinance authorizing the refunding bonds contradicts the authority granted by Section 1207.003, and therefore such ordinance would not be subject to the referendum requirement of Section 7.03 of the charter.

State law requires the refunding bonds to be submitted to the Texas Attorney General for review and approval. We have contacted the Public Finance Division of the Attorney General’s office to determine if they agree with our analysis and will let you know if they agree or not.

Please contact us if you have any questions regarding the above, or if we may be of further assistance.

Wow.

First, Texas courts have ruled repeatedly that the power of referendum is reserved, not granted, to the people. As such, its provisions must be liberally construed in favor of the reservation [of the power of referendum].

Second, courts have ruled that the power of petition can be “limited…through either express directive or by implication. Quick v. City of Austin, 7 S.W.3d at 124. And, before it can arise through implication, the provisions must evince a clear and compelling intent to limit the power.

Let me stop here and ask two important questions:

  1. Where in Section 1207.003 of the Texas Code does Mr. Lowry find a clear and compelling intent to limit the power of referendum?
  2. Whom does Mr. Lowry represent?

The answer to question #1 is left to the informed reader. The answer to question #2 is found in the City Charter:

Section 5.04. City attorney.
The city council shall appoint a competent and duly licensed attorney practicing law in Tarrant County, Texas, who shall be the city attorney. He shall receive for his services such compensation as may be fixed by the city council and shall hold his office at the pleasure of the city council. The city attorney, or such other attorneys selected by him with the approval of the city council, shall represent the city in all litigation. He shall be the legal advisory for, and attorney and counsel for, the city and all departments thereof.

So the City Attorney represents the City. And that includes us. Page vi of the Keller Budget lays out an organizational chart that puts The People of Keller at the top. So whom does he represent when there is a conflict between the city council and the people they represent? History says he represents the council every time, and sometimes represents the city manager against the people and the council.

Here are some lowlights of Mr. Lowry’s tenure with Keller:

Mr. Lowry’s argument is without merit, and it’s time for his tenure to end.