From the Sunday letters to the editor. I'm going to copy it here for future reference.
Former city attorney explains
In the dispute over the city's contract with the Center Serving Persons with Mental Retardation, it appears that Mayor Bill White would have been spared the painful duty of confronting the center, not to mention the risk of discouraging future gifts to the city, if the legal department had done more thorough research of the facts surrounding documents called leases.
During the 1960s, the City Council wanted to accept the offers of several charities to use vacant city land for various social services. Since then, these charities have donated millions of dollars worth of buildings, furnishings and social services to the public without the city's having to pay a cent.
Many times in the past, the city has accepted donations for public use with conditions requiring the city to use the gift for the purposes intended. For example, land was taken off the tax roll when the city acquired Memorial Park by paying part of its market value and accepting the rest of its value as a gift. The city agreed to severe restrictions and those restrictions are perpetual.
In these cases, the city owned the land and had legal authority to build the buildings and perform all the services at taxpayer expense. Instead, they agreed to let the charities pay all those costs with the agreement that as long as the charity performed properly, it would be permitted to render the public service for a specified time.
One charity has relinquished to the city a perfectly good building before the agreed term expired: the center for senior citizens. The city built a community center nearby and is providing at taxpayer expense what the charity had been paying for so long. The charity was happy to be relieved of the burden.
The fact that the form of a lease was used does not invalidate the agreement to accept a gift with restrictions that the gift be used for the purpose intended. The Texas Supreme Court has held in a line of cases that general warranty deeds were actually mortgages under the facts of those cases.
The agreements here are not commercial leases, but are actually contracts to accept gifts of buildings, furnishings, maintenance and social services to the public for a term of years.
No doubt a gift with unreasonable conditions could be rejected and returned to the donor if the City Council that accepted the gift acted in bad faith or abused its discretion. I was not city attorney when the center's leases were made, but I recommended other such agreements to accept donations using the lease form to set out the conditions of the gifts, and City Council approved them. I do not think City Council abused its discretion in accepting gifts for public use for 99 years.
JOHN WILDENTHAL former city attorney of Houston, Houston