Va. Supreme Court Denies F.C. Petition for Water Case Rehearing

The Supreme Court of Virginia denied the City of Falls Church’s Petition for a Rehearing in the case of City of Falls Church v. Fairfax County Water Authority today.

The City petitioned the State Supreme Court after Fairfax County Circuit Court Judge R. Terrence Ney ruled in January that the City’s longstanding “return on equity” transfer from its water fund to its general fund was a violation of the City’s charter and was unconstitutional. The City appealed that ruling because it was the City’s position that the City’s charter and the Virginia Constitution both expressly authorized the transfer. Moreover, many other cities and towns that operate utilities throughout the Commonwealth have made such a profit transfer in the past and continue to do so.

“We are very disappointed in the Supreme Court’s denial of the City’s appeal,” said Wyatt Shields. “Going forward, while this means that the City general fund will no longer receive the revenue from the water system that it has for more than 40 years, the loss of that revenue stream was factored into the current FY11 operating budget. The City of Falls Church will continue its mission to provide excellent water utility service at a fair and reasonable price to its customers in the City and Fairfax County.”

All Court rulings, including the Nov. 15 Virginia Supreme Court ruling, can be viewed on the City’s web site at

Today’s ruling can be viewed below:

Order Denying Petition for Rehearing: Nov. 15, 2010