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Click here for the full text of this decision FACTS:The Texas Interlocal Cooperation Act, Texas Government Code ��791.001-.033, allows political subdivisions to contract with one another to more efficiently share resources and responsibilities. Ninety-two local governmental entities formed the Texas Political Subdivisions Property/Casualty Joint Self-Insurance Fund by entering into an interlocal cooperation agreement to pool funds to provide casualty insurance to participants. The fund provides a self-insurance risk pool and claim administration for its members. Participants in the fund include eight counties, six municipalities, 43 independent school districts and various special districts and other political subdivisions. Ben Bolt-Palito Blanco Consolidated Independent School District (Ben Bolt), a small school district in Jim Wells County, purchased an insurance policy from the fund for a coverage period between April 2002 and 2003. In December 2002, Ben Bolt sustained extensive water and mold damage to one of its school facilities and submitted a claim to the fund. Until that point Ben Bolt had paid and the fund had accepted all premiums due under the policy. The fund denied the claim on the basis that the alleged loss was not covered under Ben Bolt’s policy. Ben Bolt then filed a declaratory-judgment action seeking a determination that the loss was a covered occurrence under the insurance agreement’s terms, and any other further relief to which it might be entitled. In response, the fund asserted immunity in a plea to the jurisdiction and motion to dismiss, which the trial court denied. The fund then filed an interlocutory appeal. The court of appeals held that, as a governmental entity, the fund is entitled to immunity from suit; finding no legislative waiver of that immunity, the court of appeals reversed and dismissed the case for want of jurisdiction. The Texas Supreme Court granted Ben Bolt’s petition for review to determine the nature and extent of the Fund’s alleged immunity from suit. HOLDING:Reversed and remanded to the trial court. It is clear, the Texas Supreme Court stated, that the fund in this case is composed of members which, like Ben Bolt, are themselves governmental units entitled to immunity. However, the court stated, the fund asserts discrete governmental-unit status in its own right separate and apart from its members. The court concluded that the fund’s nature, purposes and powers demonstrate legislative intent that it exist as a distinct governmental entity entitled to assert immunity in its own right for the performance of a governmental function. With regard to that function, the court stated, the fund enjoys the same governmental immunity as other political subdivisions. Texas Local Government Code �271.152, the court noted, generally provides that a local governmental entity that is authorized by statute or the constitution to enter into a contract and that enters into a contract waives sovereign immunity to suit for the purpose of adjudicating a claim for breach of the contract. The court concluded that this statutory waiver applied to the insurance-coverage dispute between Ben Bolt and the fund. OPINION:O’Neill, J., delivered the opinion of the court, joined by Jefferson, C.J., and Wainwright, Brister, Medina, and Johnson, J.J. Green, J., did not participate in the decision. DISSENT: Willett, J., delivered an opinion dissenting in part, joined by Hecht, J. “I agree with most of the Court’s opinion, but respectfully dissent from Part II(D) because I do not believe that section 271.152 of the Local Government Code clearly and unambiguously waives the Fund’s governmental immunity.”

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