8th Court of Appeals rules in favor of Pickett once again

EL PASO, Texas (KVIA) -- A Texas appeals court kept a lower court's decision that the City of El Paso's franchise fee on El Pasoans' water bills is an illegal tax.

The fee was implemented in 2015 and relocated to city departments, according to former state Representative Joe Pickett. The purpose of the fee was for the "wear and tear on the City's right[s]-of-way," according to documents.

Pickett looked into the city's budget after he noticed a 50% increase in the franchise fee in his water bill.

In 2020, he filed a lawsuit against the city after he didn't get a response to his questions to city officials.

District Court Judge Patrick Garcia ruled the fee as unconstitutional in 2024, and the city appealed.

The appeals court sided with Pickett that the $6 franchise fee is illegal, and that the city used the fees to generate revenue, rather than the costs of the trucks' wear and tear.

Pickett sent ABC-7 a statement that reads in full below:

"On June 9, 2026, the eight court of appeals after hearing oral arguments, and doing their own research and analysis, ruled to uphold the 384th judicial district court ruling of August 2024, that the franchise fee of $6 charged on our sanitation bills is unconstitutional and should be discontinued. The franchise fee constitutes an impermissible tax, is an unconstitutional taking, and/or is not authorized by law The ordinance is invalid as written.

An Extremely crucial point the Eight Court of Appeals stated was:

“Because Pickett faced criminal penalties if he refused to pay the fee, he paid it under duress as a matter of law, and the city is not immune to damages in the form of a refund”. If I am entitled to a refund so is everyone in El Paso that pays a water and sanitation bill!

The City of El Paso is collecting nearly $14 million dollars a year for their slush fund they created and nearly an additional $7 million on another fee I believe just as illegal.

This has been almost six years since I initially filed the suit. I did not start out to do that. When I became aware of the most egregious increase, $4 to $6, is when I started asking questions. I was not aware at that time that the City of El Paso had created this new fee in 2014 at $1.10 and called it a franchise fee in a budget resolution. The city was not challenged by the public or any elected official for that matter either, then raised the fee to $4. Then they got greedy and raised it 50% to $6.

I called the city manager at the time asking for an explanation, he would not explain. I called the City Representative for my area at that time, she would not respond either. I then decide to initiate an open records request about the last increase. This is when it became clear that the City had created an illegal fee to fund what they wanted to use it for, but claiming it was for street repairs!

I found the budget resolutions using the money for expenditures other than street repair. I caught them at, filed suit and here we are six years later.

My point is that if the city needs money for things they believe are important to you and I, just be honest, up front, tell us what you want it for and defend your position. Do not create a slush fund, saying it is a fee when it is a tax, claim to hold the line, but continue to raise those fees (taxes) whenever it suits you.

During the last six years, the city hoped to wear me down, they delayed, delayed, found ways to postpone and the trail finally came about in August 2024. The City lost, delayed, delayed, postponed, then filed an appeal. I finally got before the Appellate Court March 19th of this year, with the ruling June 9th.

As a side note, I also questioned a new “franchise fee” on the water portion of our bills the same time as I was attempting to get an explanation from the City of El Paso about the $6 fee but focused the first suit on the $6.

The City of El Paso collects nearly $7 million a year, up from $3.5 million when they created this “franchise fee” they charge themselves, that we pay for, on the water side of our bills.

During discovery for the trial of the first case, we found an internal letter from the Chair of El Paso Water to the Mayor of El Paso stating the probable illegality of a “franchisee fee” for El Paso Water Utilities. The letter goes on to say: “imposing an arbitrary “franchisee fee” of $3,550,000 is not only subject to constitutional challenge but additionally may violate City bond covenants to take no action to impair the water and waste water systems”. We were unable to use this at trial, but may have the opportunity to in the near future.

At one point a couple years into the suit, I offered to settle the case if the City would use 100% of the money on what they claimed in their own ordinance, “to use for the wear and tear on city streets”. THEY DECLINED.

What happens next? This administration, just like the prior two, has been unwilling to do the right thing. I believe they will delay, delay, postpone, attempt another appeal, this time before the Texas Supreme Court. I am stead fast in my convictions and will fight to the end. In the meantime, I will be discussing with my legal counsel a second suit of the “franchise Fee”, I just mentioned that is on our water bills.

We have not only the evidence in the first trail but will undoubtedly fine additional, to make the case, like the internal letter pointing out the probable illegality of their actions.

So, for three administrations the secret continues, the slush fund thrives.

Other facts that came out during the trail, not necessarily illegal, but eye opening.

The City of El Paso collects over $60 million a year in “franchise Fees” from legitimate utilities, etc., more than enough to fix streets. More than they spend on streets in a year.

We also learned that the sanitation department runs as an enterprise fund, that means PROFIT in government. The City, at time of trail ,was sitting on a surplus of around $95 million dollars. Let me repeat a SURPLUS of $95 million.

Based on the services we receive verses other major cities, we get almost nothing for the money we have to pay."

ABC-7 also reached out to the City of El Paso for comment, they sent in this statement:

"The City of El Paso is reviewing the decision by the 8th Court of Appeals and evaluating all of our legal options at this time."

The city has 45 days to file another appeal if they wish, and that would go to the Texas Supreme Court.