On May 27, 2016, in Town of Lakewood Village v. Bizios, the Texas Supreme Court held that general law municipalities do not have the authority to enforce building codes within their extraterritorial jurisdictions (ETJs). This holding will significantly impact the private property rights of landowners with property located outside a general law municipality’s corporate limits, while further restricting the already limited breadth of powers held by these municipalities.

In Texas, there are general law and home rule municipalities. A general law municipality has no charter and may only exercise those powers that are expressly granted or necessarily implied by state or federal law. A home rule municipality, on the other hand, may do anything authorized by its charter that is not specifically prohibited or preempted by state or federal law.

The Bizios case involved property located in the ETJ of the Town of Lakewood Village, a general law municipality. Although the Bizios property is located entirely within the Town’s ETJ, and the Town ordinances adopted building codes and made them applicable to the ETJ, Bizios did not obtain building permits from the Town before starting construction on his property. The Town filed suit after Bizios refused to cease construction. The trial court granted a temporary injunction, and the Fort Worth Court of Appeals unanimously reversed the temporary injunction, holding that the Town had no authority to enforce building codes within its ETJ. The Town petitioned the Texas Supreme Court for review of the decision.

Because general law municipalities are granted only those powers that are expressly authorized by the legislature, or those that are reasonably necessary to make effective the expressly granted powers, the Town argued that it had been expressly granted the power to enforce its building code in the ETJ under sections 212.002, 212.003, 214.904, and 233.153 of the Texas Local Government Code. The Supreme Court rejected this argument, reasoning that although general law municipalities had been expressly granted the power to regulate plats and subdivisions, which includes governing the division and development of land, general law municipalities had not been granted the power to govern the construction of buildings in the ETJ. The Supreme Court additionally held that while these sections contemplate that this authority may be expressly granted to general law municipalities by statute, or that home rule cities may inherently have this authority, these sections do not expressly grant this authority to general law municipalities themselves. The Supreme Court also supported the Court of Appeals reasoning that the reference to “municipalities” in these sections does not grant this authority to all municipalities. In contrast, “municipalities” simply refers to those municipalities that otherwise have this power.

In addition to arguing that the Local Government Code expressly grants authority to enforce building codes within a municipality’s ETJ, the Town also contended that the Local Government Code impliedly grants this authority. Specifically, the Town argued that ETJs serve the purpose of promoting the general health, safety, and welfare of persons residing in and adjacent to the municipalities, and general law municipalities are authorized to adopt rules governing plats and subdivisions for that same purpose under section 212.001. The Town reasoned that building codes serve to accomplish this purpose by protecting persons from unsafe structures, and thus the authority to enforce building codes in the ETJ is impliedly granted in order to achieve this objective. The Supreme Court again rejected the Town’s argument, reasoning that a general law municipality’s powers must either be expressly granted or be impliedly necessary for carrying out express powers, and building codes are not necessary to the task of regulating plats and subdivisions.

Finally, the Town argued there are public policy reasons for granting the authority to enforce building codes in a general law municipality’s ETJ. The Town argued that the duty under the Local Government Code to protect the health and safety of persons in the ETJ presents a public policy reason for granting the authority to enforce building codes in a general law municipality’s ETJ, and that the municipality’s police powers require this authority for the same reasons. The Supreme Court responded and held that because general law municipalities cannot exercise powers unless they are expressly granted to the municipality by the legislature, the judiciary cannot grant authority to municipalities itself, even when there are public policy reasons for doing so.

This holding will have significant implications for both property owners building structures outside of a general law municipality’s boundaries, as well as the general law municipalities desiring to enforce their building codes in their ETJs. This case did not address whether home rule cities have the authority to enforce their building codes it their ETJs nor did this case have an impact on general law cities’ authority to enforce other regulations in their ETJs, such as subdivision regulations, that are expressly granted to them. As a result of this case, general law municipalities will likely be waiting in anticipation for the 2017 legislative session to see if the Texas legislature will reverse the effect of Bizios with an express grant of authority to general law municipalities to enforce building codes in their ETJs.