The City of Falls Church filed Petition for Appeal with the Supreme Court of Virginia today seeking to overturn the decision by Fairfax Circuit Court Judge R. Terrence Ney that ruled Falls Church’s long-standing practice of taking an annual “return on investment” from its water fund “unconstitutional.”

Falls Church’s adversary in the case, the Fairfax Water System, has until April 28 to file a rebuttal, and it is expected that a hearing onn the petition will be scheduled in mid-July. If the petition is granted, then a hearing before the full Supreme Court on its merits will be held in the fall.

Falls Church’s Office of Communications made the announcement at 6 p.m. today. The 35-page filing by the City, represented in the petition by City Attorney John E. Foster, Alexander Smith of Reed Smith LLP, and J. Patrick Taves, T. David Stoner and Michael Lockaby of Greehan, Taves, Pandak and Stoner, PLLC, states that it is “aggrieved” by Judge Ney’s ruling of January 6, 2010. The petition alleges that Ney’s court “erred when it allowed Fairfax Water to claim, and ultimately rules, that the City violated its charter (1) because the this unpleaded claim was raised for the first time in the middle of the trial, (2) the City Charter does not require that the City Council set rates every year so that receipts of the water system will equal expenses, and (3) there was no evidence that the water system had lost money for three straight years.”

The Falls Church petition further asserts that “the trial court erred when…it held unconstitutional the last sentence of…the City Charter and the City’s practices of earning a profit from its water system and transferring that profit to the general fund, because the City’s practices were undertaken pursuant to that Charter provision, which was adopted by the General Assembly as authorized by Article 7 of the Constitution.” The court erred, it states, “when it held that the City imposed an unconstitutional tax” and as a result “granted retrospective relief” to Fairfax Water and assessed court costs against the City.

Falls Church City’s Petition for Appeal can be found here. (PDF)