The final outcome of the three-year “David Vs. Goliath” legal struggle pitting the interests of the 11,400 residents of the City of Falls Church and its water system against those of the 1.1 million residents of the neighboring behemoth, Fairfax County, came in the form of a whimper this week, when the Virginia Supreme Court simply declined to hear an appeal of its earlier ruling.
There is nowhere else for the City of Falls Church to turn. The ruling by the Fairfax Circuit Court has been upheld, prohibiting the City’s practice of extracting an annual $2.2 million “return on investment” (ROI) from its Water Fund to buoy the revenue side of its operating budget ledger.
The practice, according to Judge Ney of the Circuit Court, constituted an unfair burden on Fairfax County’s users of the Falls Church system, and not only did he order the extraction halted immediately, but insisted the City pay back to its water fund $2.2 million from the previous fiscal year.
From our point of view, having followed the City’s careful deliberations over years to establish the credibility of its ROI practice, and examining the precedents in practice by other jurisdictions over time and the law, itself, the outcome of the case is flatly wrong.
It is also clear to us that this matter is not really about the City’s ROI policy, but it is about Fairfax County’s designs on the massive new development of Tysons Corner that is now in the works.
Tysons Corner has, for half a century, been by both formal and informal agreements serviced by the Falls Church water system, which has over 100,000 customers in Fairfax County. The whole legal dust-up arose when Fairfax County broke a half-century of practice by invading, so to speak, Falls Church’s territory in a heavy-handed fashion. Fairfax not only offered to provide water service to a new development in the Falls Church territory, but tried strong-arming the developer, threatening that without signing up with Fairfax water, any zoning or other special modifications it sought would fail.
Falls Church could not sit back and let this happen, and the City Council was given legal advice that it needed to act preemptively in court, or risk losing everything to its big, bullying neighbor. The Council was unanimous in agreement. The City fought gallantly, got the strong-arming practice rescinded, but lost overall.
It’s anybody’s guess what happens now. The Golden Goose is in 100,000 new residential units slated for construction in Tysons Corner in the period ahead.
But Falls Church has not lost a single customer to Fairfax so far. It has also pre-discounted the loss of its water system ROI from its operating budget, and although times will be tough moving forward, so are they everywhere. This by no means is a fatal blow to the viability of Falls Church as an independent jurisdiction, as much as many in Fairfax County may desire that outcome.