Saturday, May 8, 2010

CITY OF HOUSTON v. STUDENT AID FOUNDATION ENTERPRISES

MEMORANDUM OPINION

WILLIAM J. BOYCE, Justice.

The City of Houston appeals the trial court's order denying its plea to the jurisdiction. Because we conclude that the claim of appellee Student Aid Foundation Enterprises ("SAFE") is not ripe, we reverse the trial court's order and dismiss this cause for lack of subject matter jurisdiction.

BACKGROUND

The City regulates development of property in flood-prone areas. In October 2006, the City amended chapter 19 of the City of Houston's Code of Ordinances to impose new, more stringent restrictions on development in areas designated as a "floodway."See Houston, Tex., Ordinance 2006-894 (Aug. 30, 2006). The amended ordinance provided that "[n]o permit shall hereinafter be issued for a development to be located in any floodway if that development provides for . . . [n]ew construction, additions to existing structures, or substantial improvement of any structure within the floodway." The ordinance as amended expressly prohibited any variances except for certain instances involving bridges and facilities necessary to protect the health, safety, and welfare of the general public. The 2006 amendment also adopted new maps redefining the floodway under chapter 19.

SAFE is a non-profit corporation that provides academic scholarships to students at Rice University in Houston. SAFE owns vacant property that it purchased as an investment, and it periodically sells or leases portions of the property and uses the money for its philanthropic purpose. The 2006 amendment to the ordinance placed SAFE's property in the floodway for the first time. In 2008, the City again amended chapter 19 and significantly relaxed the restrictions on development in a floodway. See HOUSTON, TEX., CODE ch. 19 (2008). SAFE filed this suit shortly after the 2008 amendment, claiming a regulatory taking of its property based on the 2006 amendment. SAFE alleged that the 2006 amendment constituted a taking of its property because the strict development restrictions meant it could neither construct improvements on the property not sell it to anyone who wished to do so.

The City filed a plea to the jurisdiction, arguing in part that SAFE's claim is not ripe. The trial court denied the City's plea, and this appeal followed.

ANALYSIS

Ripeness is a threshold issue that implicates the court's subject matter jurisdiction. See Waco Indep. Sch. Dist. v. Gibson, 22 S.W.3d 849, 851 (Tex. 2000). The lack of subject matter jurisdiction properly may be raised by a plea to the jurisdiction. See Tex. Dep't Parks & Wildlife v. Miranda, 133 S.W.3d 217, 225-26 (Tex. 2004). We focus on whether facts have been alleged that affirmatively demonstrate the trial court's jurisdiction. See City of Waco v. Lopez, 259 S.W.3d 147, 150 (Tex. 2008);Kessling v. Friendswood Indep. Sch. Dist., 302 S.W.3d 373, 385 (Tex. App.-Houston [14th Dist.] 2009, pet. filed). We review a trial court's ruling on a plea to the jurisdiction de novo. See Lopez, 259 S.W.3d at 150; Kessling, 302 S.W.3d at 385.

Both the United States and Texas Constitutions prohibit the government from taking private property for public use without just compensation. See U.S. CONST. amend. V; TEX. CONST. art. I, § 17; see also Hallco Tex., Inc. v. McMullen County, 221 S.W.3d 50, 56 (Tex. 2006) (recognizing similarity between Texas and federal constitutional provisions regarding taking of property and noting it is appropriate to look to federal law for guidance). Although governments can regulate property under a valid exercise of police power, a regulatory action can constitute a taking requiring compensation under some circumstances. See Palazzolo v. Rhode Island, 533 U.S. 606, 617 (2001); Hallco, 221 S.W.3d at 56. SAFE argues that the 2006 amendment made its property unmarketable and therefore constituted a regulatory taking.The City argues that SAFE's claim is not ripe because SAFE (1) never submitted a permit application or variance request to the City and (2) had no plans for the property in 2006 and thus did not suffer a concrete injury arising from the 2006 amendment.

Ripeness concerns the timing of a lawsuit. See Gibson, 22 S.W.3d at 851. A lawsuit is ripe if the facts are sufficiently developed so that a concrete injury has occurred or is likely to occur, rather than being contingent or remote. See id. at 851-52. A case is not ripe when determining whether there is a concrete injury depends on contingent or hypothetical facts or events that have not yet come to pass. Id.

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