Appeal of City of Dubuque Bridge Commission
| Decision Date | 11 August 1942 |
| Docket Number | 46015. |
| Parties | Appeal of CITY OF DUBUQUE BRIDGE COMMISSION. |
| Court | Iowa Supreme Court |
Smith & O'Connor, of Dubuque, for appellant.
John J. Kintzinger, of Dubuque, for appellee.
There are two bridges at Dubuque, one which was at the time of the appeal herein under construction; the other has been in use for a number of years. The tax levied against the latter, the old bridge, is the one under consideration here. For the purpose of the construction of a new bridge, there was created what is known as the City of Dubuque Bridge Commission. The bridge was an interstate bridge and the act of Congress creating the Commission is found in Chapter 318 First Session of the 76th Congress, 53 Stat. p. 1051. The title of the act is "An act creating the City of Dubuque Bridge Commission and authorizing said commission and its successors to purchase and/or construct, maintain, and operate a bridge or bridges across the Mississippi River at or near Dubuque, Iowa, and East Dubuque, Illinois." The act was duly approved July 18, 1939, and was later amended to extend the time for commencement of construction and time for retirement of bonds, by act of Congress duly approved April 30, 1940, 54 Stat. 174. The statute under which the Commission operates may be summarized as follows:
Sec. 1 authorizes the construction of the bridge and the purchase reconstruction, maintenance, and operation of all or any existing bridges for vehicular traffic crossing the Mississippi River at or near Dubuque. Sec. 2 confers upon the Commission the right of eminent domain, and the authority to enter into agreement with the States of Iowa and Illinois, or any political subdivision thereof, with reference to use of any lands or property owned by them. Sec. 3 authorizes the Commission to charge tolls, subject to the approval of the Secretary of War and in accord with law. Sec. 4 provides for the issuance of bonds to pay the cost of acquiring or constructing bridges, and gives the Commission authority to mortgage its property to secure the same. Sec. 5 provides terms and conditions for fixing rates of tolls. Sec. 6 provides that the Commission is not required to maintain or operate any bridges purchased by it until "if and when all bonds issued for account of such bridge or bridges shall have been retired or provision for the payment of interest on and retirement of such bonds from the revenues from any other bridge or bridges shall have been made at the time of issuance of such bonds." It also authorizes the Commission to abandon or dismantle any such bridges, subject to Federal approval. Sec. 7 provides that when all bonds outstanding have been retired, the Commission may deliver deeds or other suitable instruments of conveyance of the interest of the Commission in and to the bridge or bridges extending between the State of Iowa and the State of Illinois, that part of said bridge or bridges within Iowa to the State of Iowa or any municipality or agency thereof as may be authorized by or pursuant to law to accept the same. The same conditions apply to that part within Iowa Illinois, and that part between Dubuque and Wisconsin. And it further provides that if the Iowa, Illinois, or Wisconsin interests as they are so designated, as the case may be, fail to accept, or are not authorized to accept, their respective portions of said bridge or bridges, then the Commission may deliver deeds or other suitable instruments of conveyance of said portions, to any other interest which may accept and may be authorized to accept the same, under the condition that the bridge or bridges shall thereafter be free of toll and be properly maintained, operated, and repaired by said interests to whom said conveyances are delivered; but if any of the interests shall not be authorized to accept or shall not accept the same under such conditions, then the bridge or bridges shall continue to be owned, maintained, operated, and repaired by the Commission as a free bridge until there is an acceptance of the interests of the various states. Sec. 8 creates the Commission and provides for the membership thereof. Sec. 9 of the act provides that the Commission shall have no capital stock or shares or interest or participation and all revenues and receipts thereof shall be applied to the purposes specified in the act. It also provides for the compensation of the members of the Commission. Sec. 10 authorizes the Commission to enter into contracts with the highway departments of the respective states in the vicinity of Dubuque and to accept financial aid from such states. Sec. 11 provides that the obligations of the Commission shall not be personal liabilities of the commissioners. Sec. 12 provides that the bridge shall be constructed in accord with specifications of highway bridges as adopted by American Association of Highway officials. Sec. 13 deals with the subject of a State or City Commission taking over the operation of the bridge. Sec. 14 provides that bridges constructed, acquired and maintained shall be governed by the United States Bridge Act of March 23, 1906, 33 U.S.C.A. § 491 et seq. Sec. 15 reserves the right to alter, amend or repeal the act.
Under the powers conferred by this act, the Commission, having been appointed in conformity therewith, took over what is known as the old highway and vehicular bridge across the Mississippi River between Dubuque, Iowa, and East Dubuque, Illinois, with its western approach in the city of Dubuque, commencing on the Fourth Street Extension, and issued mortgage bonds in payment thereof to the amount of $475,000. That part of the bridge belonging to the City of Dubuque Bridge Commission and located in the State of Iowa was assessed for the year 1941 in the sum of $107,500. It was stipulated also that the real estate consolidated levy in the City of Dubuque was 46 mills in 1940, and 45.2 mills in 1941, from which assessment there was a 5 per cent general reduction by order of the Board of Supervisors. Objection was made by the Commission to the levy of this tax against the old bridge, and on May 31, 1941, the Commission filed with the Board of Review for the City of Dubuque, its complaint in writing against said assessment and asking that said property be exempt from taxation on the following grounds: 1. Said property is exempt from taxation under Section 6944, Subparagraph 1, Code of 1939, as said property is in essence Federal and State property within the meaning of said section. 2. Said property is exempt from taxation by Section 6944, Subparagraph 2, Code of 1939, as said property is devoted to a public use and is not held for pecuniary profit. 3. Said property is exempt from taxation by Section 6945, Code of 1939, inasmuch as this real estate is occupied as a public road. 4. The City of Dubuque Bridge Commission is a Federal instrumentality and its property is, therefore, not subject to State taxation. 5. The State of Iowa and its political subdivisions are the beneficial and equitable owners of that portion of the bridge located in Iowa; the City of Dubuque Bridge Commission is merely the trustee for the benefit of the State of Iowa and its political subdivisions. When the bridge is paid for, it will be transferred to the State of Iowa, or the political subdivisions thereof as provided in Section 7(a) of the Act of Congress creating the City of Dubuque Bridge Commission.
This appeal of the Commission to the Board of Review was denied and thereupon the Commission appealed to the District Court, praying the court to grant an exemption on appellant's property from taxation for the year 1941 and subsequent years, and for such proceedings as may be had in relation thereto as are provided by law and agreeable with equity. Bonds have been issued refunding the original $475,000 from the total amount of $2,800,000 which is secured by trust indenture pledging both the existing bridge and the new bridge and their revenues to the payment of same, which issue is now outstanding. The trust indenture limits expenditures for maintenance and upkeep, exclusive of taxes, to $36,000 per year. Among its proceedings, the Bridge Commission has contracted with the Iowa State Highway Commission whereby the State of Iowa is allocating $408,000, plus engineering expense, toward the cost of constructing the Iowa approach to the new bridge, and the same arrangement has been made with the highway department of Illinois for the Illinois approach.
The Act of Congress referred to and summarized above followed a previous act substantially the same except for certain provisions which met with executive disapproval so that the present act was enacted in place of the former act which is more specifically referred to in another division hereof.
The objection was made to this application for exemption that the court and the Board of Review had no jurisdiction to grant an exemption, that the Dubuque Bridge Commission was not entitled to exemption under the Act of Congress, and the fact that Congress failed to include the claims of exemption in the bill is an indication that the property should be taxed.
Hearing was had on the appeal in the District Court of Dubuque County and on January 29, 1942, the court entered judgment and decree finding that the court had jurisdiction as a court of equity of the parties and subject matter involved, and that the bridge in question (the old bridge) located on certain described real estate and owned by the City of Dubuque Bridge Commission, is not immune from State taxation, under the facts and law in this case, and that the assessment herein complained of was a lawful and valid assessment, and that the appeal of the said City of Dubuque Bridge Commission is hereby dismissed. From such decree...
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