This story was updated at 1:15 p.m. on Monday, April 17 to include comments from the presiding judge from official court transcripts.

A decision has been made in the first of two lawsuits between a local business owner, the city of McKinney and Collin County over permitting rights within the city's extraterritorial jurisdiction, according to Collin County Commissioner Chris Hill.

The court documents on the decision had not yet been released to the public as of Thursday afternoon.

Judge Mark Rusch in the 401st District Court presided over the case between the city, county and Custer Storage Center and said the city of McKinney does not have the authority to require building permits within its ETJ, which is land that the city has a right to annex, but hasn't yet done so.

According to official court transcripts, Rusch said if the property is subdivided, or should have been subdivided, the property is platted or replatted, the city has the exclusive right with respect to building permits, etcetera; to the extent it is not, that authority remains with the county.

"Custer Storage was not subdivided," Rusch said in the transcripts. "There is no evidence that supports that it was subdivided. There is no evidence that it was platted or replatted, so in this case, the City does not have the authority to insist on its permits being issued."

County Judge Keith Self, who was in attendance when the verdict was issued, said he was pleased with the result.

"Judge Rusch did an excellent job analyzing the law and I think he reached the proper conclusion based on the law," Self said.

The city of McKinney and Collin County are still in court regarding the second lawsuit over permitting rights within the ETJ with Arch Resorts. Self said he anticipates a similar ruling for that case.

"There was a hearing today [on the Arch Resorts case] but it was mainly procedural with no rulings," Self said. "That case is very similar, but there are more complex issues. However, on the issue of the permitting rights within the ETJ, I think they will reach the same conclusion based on the law."

Although Rusch did rule in favor of the county and Custer Storage regarding permitting, he ruled in favor of the city regarding building standards but said they can only apply within city limits or if the property is subdivided or replatted.

The city of McKinney issued a statement regarding the decision.

"The city is still evaluating today's decision; however, it is pleased with the Court's ruling that the 2002 city-county interlock agreement granting McKinney authority over subdivisions and building codes is valid and enforceable in the ETJ. We will continue to work with Collin County on an efficient development process for all property owners in McKinney's ETJ."



In 2001, state legislators passed House Bill 1445, which mandated cities and counties establish written agreements designating authority to regulate subdivisions and issue “other related permits” within the city’s ETJ.

In 2002 the city of McKinney and Collin County signed an interlocal agreement giving that authority to the city. Since then, the city and county have maintained their respective jurisdiction with little argument until 2015 when the county issued permits to Arch Resorts, which is an RV park, and Custer Storage & Business Center, which were both located in McKinney’s ETJ.

Although multiple tenants would be utilizing the properties, neither was subdivided the way a neighborhood traditionally would be, which has led to a debate between the city and county over which entity has permitting rights.

The city contends that in relation to subdivisions it has the inherent authority to require developers in the ETJ to obtain city building permits, inspections and approvals, and pay related fees. The city also contends the county exceeded its authority by issuing building permits to the two properties and as a result “significantly impaired” the city’s lawful authority to regulate development in its ETJ.

The county, however, states that the city’s subdivision permitting rights kick in when a landowner files to legally subdivide its property to more than one owner.

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