Barnett v. Jones

• Decision Date: 14 May 2021
• Docket Number: 1190470
• Citation: 338 So.3d 757
• Parties: Vernon BARNETT, in his official capacity as commissioner of the Alabama Department of Revenue, et al. v. Dr. Danna JONES, individually and in her official capacity as superintendent of Hartselle City Schools, et al.
• Court: Alabama Supreme Court

338 So.3d 757

Vernon BARNETT, in his official capacity as commissioner of the Alabama Department of Revenue, et al.

v.Dr. Danna JONES, individually and in her official capacity as superintendent of Hartselle City Schools, et al.

1190470

Supreme Court of Alabama.

May 14, 2021

Dorman Walker of Balch & Bingham LLP, Montgomery; and Frank C. Ellis, Jr., J. Bentley Owens III, and William R. Justice of Ellis, Head, Owens, Justice & Arnold, Columbiana, for appellants.

Theron Stokes, Sherri Mazur, and John T. Thomas of Alabama Education Association, Montgomery; Robert D. Segall of Copeland, Franco, Screws & Gill, PA, Montgomery; Samuel H. Heldman of The Gardner Firm, PC, Washington, DC; and Brian Austin Oakes of White & Oakes, LLC, Decatur, for appellees Dr. Danna Jones, Venita Jones, Dana Gladden, Hartselle City Education Association, Rodney Randell, Decatur Education Association, Rona Blevins, and Morgan County Education Association.

J. Thomas Richie and K. Laney Gifford of Bradley Arant Bault Cummings LLP, Birmingham; and Scott Burnett Smith of Bradley Arant Boult Cummings LLP, Huntsville, for appellees Morgan County Board of Education and Decatur City Board of Education.

Morgan G. Arrington, gen. counsel, Association of County Commissions of Alabama, Montgomery; and Kendrick E. Webb and Jamie H. Kidd of Webb & Eley, P.C., Montgomery, for amicus curiae Association of County Commissions of Alabama, in support of the appellants.

Carl Johnson and Melissa B. McKie of Bishop, Colvin, Johnson & Kent, LLC, Birmingham, for amici curiae Alabama Association of School Boards, School Superintendents of Alabama, and Council of Leaders in Alabama Schools, in support of the appellees.

James L. Entrekin, Jr., gen. counsel, Legislative Services Agency, Montgomery; and Othni J. Lathram, secretary, Legislative Council, Montgomery, for amicus curiae Senator Jimmy Holley, chair of the Legislative Council of the Legislature of Alabama, in support of the appellees.

MITCHELL, Justice.

This case involves the constitutionality of a 2019 local law that appropriates a large portion of Morgan County's proceeds from the Simplified Sellers Use Tax ("SSUT") to the county and city boards of education in Morgan County. The Morgan County Commissioners have appealed a judgment upholding the local law and contend that the local law violates Ala. Const. 1901 (Off. Recomp)., art. IV, § 105, because, they say, it creates a variance with -- and changes the result under -- preexisting general laws. Because the subject of the local law is not provided for by general law, we hold that it does not violate § 105 and therefore affirm.

Facts and Procedural History

The act at the heart of this case is Act No. 2019-272, Ala. Acts 2019 ("the Local Act"), a local law that sets out how the SSUT proceeds distributed to Morgan County are to be appropriated. The Legislature adopted the SSUT in 2015 through the passage of the Simplified Seller Use Tax Remittance Act ("the SSUT Act"),§ 40-23-191 et seq., Ala. Code 1975. The SSUT Act created mechanisms by which the State can collect a use tax from online sales of goods and services. See id. It also dictates how the proceeds from the tax are distributed. See § 40-23-197(b), Ala. Code 1975. Under this statutory framework, 20% of the SSUT proceeds are currently distributed to "each county in the state ... on a basis of the ratio of the population of each county to the total population of all counties in the state as determined in the most recent federal census prior to the distribution." § 40-23-197(b). See also § 40-23-197(a).

The Legislature has amended the SSUT Act several times. Relevant to the arguments in this case, a 2018 amendment added what is currently § 40-23-197(b). See Act No. 2018-539, § 1, Ala. Acts 2018. That provision of the SSUT Act now reads, in pertinent part:

"[T]he net proceeds after the distribution provided in subdivision (1) of subsection (a) shall be distributed ... 40 percent to each county in the state, and deposited into the general fund of the respective county commission, on a basis of the ratio of the population of each county to the total population of all counties in the state as determined in the most recent federal census prior to the distribution."

§ 40-23-197(b) (emphasis added).

In 2019, the Legislature passed the Local Act, which applies only to Morgan County and serves as the basis of the parties’ dispute. The Local Act dictates how the SSUT proceeds distributed to Morgan County must be appropriated following their deposit into the county's general fund. After the proceeds are deposited, Morgan County retains 5% of the proceeds, but the remainder is to be transferred elsewhere. Eighty-five percent of the remaining proceeds are split between the county and city boards of education; another 13.5% goes exclusively to the Morgan County Board of Education; and the final 1.5% goes in equal shares to certified volunteer fire departments in Morgan County. Act No. 2019-272, § 2.

The Morgan County Commission refused to comply with the appropriation requirements of the Local Act. As a result, Dr. Danna Jones, individually and in her official capacity as the superintendent of Hartselle City Schools; Venita Jones, individually and in her official capacity as a member of the Hartselle Board of Education; Dana Gladden, Rodney Randell, and Rona Blevins, individually and in their official capacities as presidents, respectively, of the Hartselle City Education Association, the Decatur Education Association, and the Morgan County Education Association; and the Hartselle City, Decatur, and Morgan County Education Associations brought this suit in the Montgomery Circuit Court in October 2019. They sued the members of the Morgan County Commission -- Ray Long, Jeff Clark, Randy Vest, Don Stisher, and Greg Abercrombie ("the Commissioners") -- in their individual and official capacities and Alabama Commissioner of Revenue Vernon Barnett, seeking a judgment declaring the Local Act constitutional as well as injunctive relief. The defendants answered the complaint and asserted that the Local Act violates § 105. The crux of their argument is that the Local Act creates a variance from preexisting general laws of statewide application and changes the results dictated by the SSUT Act and the Budget Control Act, § 11-8-1 et seq., Ala. Code 1975. This singling out, they say, is prohibited by § 105.

Less than a month after the action began, the Decatur City Board of Education and the Morgan County Board of Education moved to intervene as plaintiffs. Those intervening plaintiffs named the same defendants in their complaint and, in substance, sought the same relief as the plaintiffs. Their motion to intervene was granted.

After briefing, a hearing, and the filing of proposed orders from all parties, the trial court entered its final judgment in favor of the plaintiffs and the intervening plaintiffs. It held that the Local Act did not violate § 105 and ordered the Commissioners to pay all SSUT proceeds distributed to Morgan County after the date of the entry of the order as provided in the Local Act. The Commissioners appealed.¹

Standard of Review

There are no disputed facts in this case. Thus, our review of the trial court's judgment on the constitutionality of state legislation is de novo. Richards v. Izzi, 819 So.2d 25, 29 n.3 (Ala. 2001). It is also established that this Court will apply a "presumption ... in favor of [the] validity [of state laws]." Alabama State Fed'n of Labor v. McAdory, 246 Ala. 1, 9, 18 So. 2d 810, 815 (1944) ; Clay Cnty. Comm'n v. Clay Cnty. Animal Shelter, Inc., 283 So. 3d 1218, 1229 (Ala. 2019). That is because "it is the recognized duty of the court to sustain the act unless it is clear beyond reasonable doubt that it is violative of the fundamental law." Alabama State Fed'n of Labor, 246 Ala. at 9, 18 So. 2d at 815.

Analysis

The Commissioners challenge the Local Act under § 105 of our State Constitution, which states:

"No special, private, or local law, except a law fixing the time of holding courts, shall be enacted in any case which is provided for by a general law, or when the relief sought can be given by any court of this state; and the courts, and not the legislature, shall judge as to whether the matter of said law is provided for by a general law, and as to whether the relief sought can be given by any court; nor shall the legislature indirectly enact any such special, private, or local law by the partial repeal of a general law."

(Emphasis added.) In essence, the Commissioners argue that the Local Act violates § 105 because the "case" or "matter" the Local Act covers is already provided for by two general laws: the SSUT Act and the Budget Control Act. Further, the Commissioners argue that because Morgan County's share of the SSUT proceeds is subsequently appropriated by the Local Act after deposit into the county's general fund, but none of the other counties’ shares of the SSUT proceeds are similarly appropriated, the Local Act creates an impermissible variance and changes the result otherwise generated by those general laws. We reject those arguments and hold that because the SSUT Act, the Budget Control Act, and the Local Act all provide for distinct cases or matters, the Local Act does not violate § 105.

As a result of the confusion that has arisen around this Court's § 105 jurisprudence, we first explain the proper framework for analyzing that constitutional provision. We then discuss why there is no § 105 violation here.

A. The § 105 Framework

From the time of the adoption of our 1901 Constitution, the text of § 105 and the caselaw interpreting it have been at war. For the first several decades, this Court applied a "substantial difference" test to assess the constitutionality of local laws. See, e.g., State ex rel. Brandon v. Prince, 199 Ala. 444, 74 So. 939 (1917). Instead of assessing what "case[s]" or "matter[s]" the Legislature had already "provided for" by general law, that test...