Azael Sepulveda, also known as Oz, loves everything about cars. He has a popular YouTube channel where more than 22 million viewers have watched him explain how to perform car repairs. He also has successfully run his own repair shop, Oz Mechanics, for 9 years with stellar reviews. Recently, Azael decided he wanted to expand his business by moving out of his leased space and buying his own shop.
Azael’s dreams seemed to be coming true when he bought a storefront in his hometown of Pasadena, Texas, in the summer of 2021. But instead of welcoming his investment in his community, the city of Pasadena forbade Azael from opening. The reason? The City decided that he had to provide 28 parking spaces—a nearly sixfold increase from the five existing spaces at the storefront—just to open his business. Azael would never need this many spots for his shop, as he is a one-man operation that takes cars by appointment only. And installing the new spots would cost him at least $40,000—almost half the price of the property and more than he can possibly afford.
As a result of the City’s unreasonable demands, Azael cannot open his new shop. This is despite the fact that the previous business that operated at the storefront—an auto machine shop similar to Azael’s — used the existing five spaces with no problems or complaints. Making matters worse, Azael tried to follow the procedure the City itself recommended to apply for an exception from the parking requirements. But when he applied, the City refused to even consider his application.
Pasadena’s requirements are unconstitutional. The Texas Constitution prohibits governments from enforcing unreasonable or overly oppressive laws that burden a person’s economic or property rights. Yet Pasadena’s parking minimums for auto repair shops have no reasonable justification and are so oppressive that they prevent entrepreneurs like Azael from opening businesses on their own property.
Azael has teamed up with the Institute for Justice to fight back against the City’s crippling and unreasonable demands. He has filed a lawsuit asking Texas state courts to strike down Pasadena’s auto-shop parking requirements and allow him to exercise his right to earn an honest living on his own property.
In May 2022, following IJ’s lawsuit, a settlement was reached which will allow Azael to open his new shop.
Motion to Enforce Mediated Settlement
Azael is the picture of the American dream. Born in Mexico, Azael moved to Pasadena, Texas, as a child and is now an American citizen. He loves everything about cars and opened his own auto repair shop in 2013.
His shop, Oz Mechanics, gets rave reviews from customers—all 72 reviews on Google gave Azael five stars, with many mentioning his professionalism, honesty, and attention to detail. 1 Oz Mechanics also has nearly 73,000 subscribers on YouTube, where Azael often posts videos explaining how to perform car repairs. 2
Now that he and his wife are expecting their first child and expanding their family, Azael wants to expand his business, too. His shop has been in a rented space in Pasadena for years, but he has dreamed of owning his own store. Azael is proud to be a long-time Pasadena resident and couldn’t imagine opening a shop anywhere else.
Azael seemed to have found the perfect location when, in the summer of 2021, he bought his own storefront at 1615 Shaver Street in Pasadena. He used all his personal savings and put his home up for collateral to make the purchase. Because the shop had previously been used for a similar business that built and repaired car engines—with the same parking spaces it has now and without problems—Azael believed it would only need minor modifications to fit his needs.
Pasadena prevents Azael from opening his new shop.
Azael knew when he purchased the property that the shop’s five parking spaces would meet his needs. It never occurred to him that parking might be an issue. But when he asked the City for permission to open his new storefront, the City said no. Instead, the City demanded that Azael provide twenty-eight parking spaces at his new location.
The City based its demand on a city ordinance that sets the minimum number of parking spaces property owners are required to provide, based on the size of the building. Just months before he purchased his property, the City doubled the parking minimums for auto repair shops to 10 spaces per 1,000 square feet of floor space. 3 Using this new rule, the City calculated that Azael would need to add 23 parking spaces—bringing the total spaces to 28—just to open his shop.
Azael cannot provide 28 parking spaces. The cost to install the additional parking lot would be at least $40,000—which is nearly half of what he paid for the storefront. Azael does not have this money, especially given that he spent every cent he had and put his own home up for collateral just to buy the property in the first place.
Moreover, Azael doesn’t need 28 spaces. He is the only employee at his shop and takes cars by appointment only. He also discourages customers from leaving their cars at the shop by charging a storage fee after their repairs are complete. Because of this, Azael averages about two cars at his shop at any given time.
But the City still insists on 28 spaces. As a result, Azael cannot open his shop and must pay the mortgage at his still-empty storefront while also continuing to pay rent at his shop’s current location so he can keep his business running. This has created a heavy financial burden and caused Azael and his wife an immense amount of stress as they prepare to welcome their first child.
Azael has tried to resolve the problem by following the City’s own recommendations, to no avail. When a local news station published a story about his situation, the City responded by inviting him to apply for a variance from the parking requirements. 4 But the City refused to accept his variance application when he tried to file it. And when Azael’s attorneys asked for the City’s reasons, the City refused to even speak to his attorneys. Azael had no choice but to turn to the courts for help.
Parking minimums, like Pasadena’s, harm communities around the country.
Minimum parking requirements, like Pasadena’s, hurt communities nationwide. They significantly increase the cost to businesses, often—as in Azael’s case—preventing businesses from opening altogether. 5 Parking minimums also eliminate green space and turn valuable real estate into asphalt-covered parking lots. 6
Recognizing this unacceptable cost, cities around the country—from Minneapolis, Minnesota, 7 to Buffalo, New York 8 —have abolished parking minimums in some or all of their cities’ jurisdictions. Pasadena, on the other hand, doubled its parking requirements for auto repair shops earlier this year. Now, its parking requirements are some of the strictest—if not the strictest—in the State. For example, both Mesquite and Killeen—cities with similarly sized populations to Pasadena’s—require auto repair shops to provide only two spaces per 1,000 square feet with a five-space minimum. 9 And none of the largest cities in Texas require auto repair shops to provide more than five spaces per 1,000 square feet. 10 Pasadena’s requirements, on the other hand, are at least double what these other cities require.
The Texas Constitution prohibits Pasadena from making irrational demands of business and property owners.
Pasadena’s parking requirements aren’t just harmful—they’re also unconstitutional. As the Texas Supreme Court held in 2015, the Texas Constitution forbids governments from imposing economic regulations that are not “rationally related to a legitimate governmental interest” or are disproportionately “oppressive” in light of a legitimate interest. 11 The Texas Constitution also forbids governments from treating similarly situated individuals differently for no good reason. 12 Pasadena’s parking requirements do all of these things.
First, Pasadena’s requirements are not reasonably related to a legitimate government interest, violating the Texas Constitution’s Due Course of Law Clause. 13 It is irrational for Pasadena to require Azael to spend tens of thousands of dollars to build dozens of parking spaces he doesn’t need. This is underscored by the fact that Pasadena requires five times the amount of parking spaces for repair shops as other similarly sized Texas cities. At the very least, Pasadena’s interest in such a burdensome regulation is not so compelling as to justify completely prohibiting Azael from serving any customers until he meets the City’s impossible demands.
Second, Pasadena’s parking requirements treat similarly situated businesses differently for no good reason, violating the Texas Constitution’s Equal Protection Clause. 14 For example, Pasadena only requires five and a half spaces per 1,000 square feet for car dealerships and four spaces per 1,000 square feet for service stations. 15 There is no good reason for Pasadena to require several times more parking spaces for auto repair shops.
In short, the Texas Constitution protects small-business and property owners, like Azael, from being crushed by oppressive and irrational government demands. Azael is teaming up with IJ to make sure that Texas continues to be a place where hard work and dreams can pay off.
The Litigation Team
The litigation team consists of IJ Senior Attorney Erica Smith Ewing, IJ Attorney Diana Simpson, and IJ Law & Liberty Fellow Tori Clark, assisted by attorneys Charles McFarland and Marie D. Harlan of McFarland PLLC as local counsel.
The Institute for Justice
The Institute for Justice is a public-interest law firm that litigates nationwide to vindicate individual liberties. At no cost to clients, IJ has defended small business owners against useless government regulations, such as the case of the Minnesota funeral home director who was told he needed to spend $30,000 on an embalming room he would never use, or the Texas hair braider who was told she’d need to pay to install five sinks even though she was prohibited from offering services that required a sink.
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