The question comes to the forefront again because of a dispute over land at I-10 and Zaragoza that had been designated to be used as a park land and part of Blackie Chesher Park. Item 10D on the February 21st meeting of City Council had to do with bringing the land in question up to code as park land. In the midst of the discussion, Representative Cortney Niland asked the million dollar question and addressed that question to City Attorney, Sylvia Firth - Is the PSB a trustee or a land manager? Sylvia Firth answered, "Managers." Of course, legal will research this and both Representative Niland and Lilly are adamant about getting to the truth.
Here are the facts as I see them: Although the PSB has been called a Board of Trustees, no trust document was ever created when establishing the PSB. Moreover, under Texas State law, the PSB cannot be a trust. Trust law is complicated but it establishes a legal relationship whereby one person or entity (the trustee) holds the legal title to property and another (the beneficiary) has the benefit of the use, enjoyment and income from the property. The beneficiary protects the property in trust from creditors and heirs but gives up decision-making about the property.
DM-444 - Dan Morales 1997
Read the 1997 opinion of Texas Attorney General Dan Morales. Here's a portion of the summary:
"The governing board of a municipal utility system acts as an agent of the municipality that created it . . . A municipal utility system may acquire or hold real property only as an agent of the municipality. Thus, the municipality may use the property or dispose of the property as it wishes. A municipality may not delegate to the governing board of its utility system ultimate control of municipal real property."
Such an agency as described in the opinion is not a trusteeship. Again,"the municipality may use the property or dispose of the property as it wishes." A beneficiary can do no such thing.
According to the definition of property held in trust, the trustee holds legal title to the property. But DM444 forbids a municipal utility (e.g., the PSB) to hold legal title to property. Thus, it can't be a trustee, no matter if the founding document for the PSB refers to that body as a "Board of Trustees".
An earlier Attorney General opinion, the Maddox Decision (JM-9971) of 1988 had to do with the sale of PSB managed land to Texas Parks and Wildlife for inclusion in the Franklin Mountains State Park. It was a decision in response to a question by then State Senator Tati Santiesteban whether the City could convey the land to the State for a price under market value.
JM-997l - Maddox Decision 1988
The ruling was simple: as the property did not generate revenues to pay debt services (money owed to bond holders) and was not useful for water or wastewater functions, El Paso could convey the land for a price (in this case) substantially under market value. The PSB fought this but lost. (Pay attention: Mr. Archuleta always contends that the PSB has already generously given land to the Park when he opposes plans to give up land for the Transmountain Scenic Corridor. In truth, the land to which he refers had to be plied out of the tight-fisted PSB.) But the City had every right to do so not as beneficiary of some trust which has never been created, but as land owner and the PSB as land manager (not trustee) could not prevent it.
Why keep repeating publicly that the PSB is a Trustee? In my opinion, Mr. Archuleta and others are smart enough to know that such a claim cannot hold up in a Court of Law. I believe that the claim is repeated to create the notion that it is true in order to have one's decisions not be questioned by policy makers. Now City Council members are questioning it and they have every right to do so.
Trust or no trust? It would seem there is no trust either as a legal entity or as a description of a relationship with the PSB and the EPWU/PSB CEO.
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