Brewery Arts Center v. State Bd. of Examiners

• Decision Date: 11 December 1992
• Docket Number: No. 23321,No. 9,9,23321
• Citation: 108 Nev. 1050,843 P.2d 369
• Parties: BREWERY ARTS CENTER; Carson City Children's Museum; Stewart Indian Museum Association, Inc.; Carson Valley Historical Society; Western Folklife Center; City of Winnemucca; City of Caliente; Lincoln County; Yerington Grammar SchoolRestoration Group Inc.; Storey County Fourth Ward School Board of Trustees; White Pine Historical Foundation, Inc.; White Pine Public Museum; and the Legislative Commission, Petitioners, v. The STATE BOARD OF EXAMINERS, Respondent.
• Court: Nevada Supreme Court

Page 369

843 P.2d 369

108 Nev. 1050

BREWERY ARTS CENTER; Carson City Children's Museum Stewart Indian Museum Association, Inc.; Carson Valley Historical Society; Western Folklife Center; City of Winnemucca; City of Caliente; Lincoln County; Yerington Grammar School No. 9 Restoration Group Inc.; Storey County Fourth Ward School Board of Trustees; White Pine Historical Foundation, Inc.; White Pine Public Museum; and the Legislative Commission, Petitioners, v. The STATE BOARD OF EXAMINERS, Respondent.

No. 23321.

Supreme Court of Nevada.

Dec. 11, 1992.

Lorne Malkiewich, Legislative Counsel and Brenda Erdoes, Chief Deputy Legislative Counsel, Carson City, for petitioners.

Frankie Sue Del Papa, Atty. Gen., Carson City, and Brooke A. Neilsen, Asst. Atty. Gen. and Jonathan L. Andrews, Chief Deputy Atty. Gen., for respondent.

OPINION

PER CURIAM:

The 1991 Nevada Legislature created the Commission for Cultural Affairs (the Commission) and required it, within one year of its formation, to establish a ten-year plan to preserve and promote Nevada's cultural resources and to develop a network of cultural centers and activities. The Legislature directed the respondent, the State Board of Examiners (the Board), to issue general obligation bonds to fund the projects identified in the ten-year plan. Pursuant to the provisions of Assembly Bill No. 590 (A.B. 590), ¹ for the first year of the ten-year plan, the Commission awarded $2,000,000 in grants to fifteen local governments and non-profit organizations. The purpose of the grants was to renovate and restore historical sites in Nevada. ²

On May 14, 1992, bond counsel for the State declined to render an unqualified approving opinion on the issuance of these bonds. Bond counsel withheld approval because of the language of A.B. 590 § 5(5), which stated that the bonds are exempt from the constitutional debt limit because the bonds are "necessary for the protection and preservation of the cultural resources of this state and for the purpose of obtaining the benefits thereof." (Emphasis added.) The second paragraph of Article 9, § 3 in the Nevada Constitution ³ does not expressly exempt "cultural resources" from the debt limitation. Bonds that are not exempt from the State's debt limit are counted against the debt limit and negatively impact the ability of the State to borrow money for other projects. The unqualified approving opinion of bond counsel is necessary before the bonds are issued, for without such an opinion, the bonds are not marketable. Bond counsel recommended either obtaining a judicial decision that severed subsection 5 from A.B. 590 § 5, or having the 1993 Legislature amend the bill.

On June 18, 1992, the Board voted unanimously to accept the recommendation of Judy Matteucci (Matteucci), the State of Nevada Budget Director and the Clerk of the Board, to defer the issuance of the bonds until this court interprets, or the Legislature clarifies, the language of subsection 5 concerning the exemption of the bonds from the constitutional debt limitation. Matteucci's recommendation was based on the "questionable constitutionality" of A.B. 590 and on the need to review all of the remaining bond authorizations.

Petitioners argue that the Board has a non-discretionary legal duty to issue the general obligation bonds to fund the grants. Also, petitioners argue that they have no plain, speedy, and adequate remedy at law, and they request that this court issue a peremptory writ of mandamus commanding the Board to issue the bonds. In the alternative, petitioners request that this court issue a peremptory writ of mandamus compelling the Board to issue general obligation bonds, "either exempt or nonexempt from the constitutional debt limitation," for $2,000,000. Petitioners argue that, if action is not taken soon, some of the historic sites that A.B. 590 is intended to preserve may be lost.

A writ of mandamus is available to compel the performance of an act which the law requires as a duty resulting from an office, trust, or station, or to control an arbitrary or capricious exercise of discretion. See NRS 34.160; Round Hill Gen. Imp. Dist. v. Newman, 97 Nev. 601, 637 P.2d 534 (1981). Mandamus is not available where the petitioner has a plain, speedy, and adequate remedy in the ordinary course of the law. NRS 34.170; NRS 34.330. Mandamus is an extraordinary remedy, and the decision as to whether a petition will be entertained lies within the sound discretion of this court. See Poulos v. District Court, 98 Nev. 453, 455, 652 P.2d 1177, 1178 (1982).

However, a writ of mandamus will not be "granted in anticipation of a supposed omission of duty, however strong the presumption may be that the persons whom it is sought to coerce by the writ will refuse to perform their duty when the proper time arrives." State v. Public Service Com., 44 Nev. 102, 112, 190 P. 284, 286-87 (1920). "It is incumbent on the relator to show, not only that the respondent has failed to perform the required duty, but that the performance thereof is actually due from him at the time of the application." State of Nevada v. Gracey, 11 Nev. 223, 233 (1876).

The petition for the writ of mandamus alleges that the Board voted "to defer the issuance of the bonds required by A.B. 590." However, the Board has not failed or refused to act, and it has only voted to delay the issuance of the bonds. Because the Legislature did not designate a precise time in A.B. 590 for the issuance of the bonds, we infer that "reasonable time" and "reasonable diligence" were intended. Fuller v. Knight, 241 Ala. 257, 2 So.2d 605, 609 (1941); Bremerton Municipal League v. City of Bremerton, 13 Wash.2d 238, 124 P.2d 798, 800 (1942). "No rule can be laid down as to within what time bonds must be issued after they have been voted for or their issuance directed...." Fuller, 2 So.2d at 610. See Chickaming v. Carpenter, 106 U.S. 663, 1 S.Ct. 620, 27 L.Ed. 307 (1882) (even where statute provides that bonds shall be issued within certain number of days after election authorizing the issuance, valid bonds may be issued after time specified). Courts have found it is not unreasonable to have delays of five and nine years following the authorization to issue bonds. Perl-Mack Civil Ass'n v. Board of Directors, Etc., 140 Colo. 371, 344 P.2d 685 (1959) (en banc) (five years); Missouri Electric Power Co. v. Smith, 348 Mo. 738, 155 S.W.2d 113 (1941) (nine years). In Petition of City of St. Louis, 363 S.W.2d 612 (Mo.1963) (en banc), the court held that a delay of eighteen years did not bar issuance of previously unissued bonds. Based on these cases, we conclude the Board's delay, which has been less than two years, is within a reasonable time.

NRS 349.071(1) provides in part: "The state board of examiners may issue and redeem securities on behalf of the state, when such issue is authorized by law." (Emphasis added.) In S.N.E.A. v. Daines, 108 Nev. 15, 824 P.2d 276 (1992), this court stated: "[I]n statutes, 'may' is permissive and 'shall' is mandatory unless the statute demands a different construction to carry out the clear intent of the legislature." Id. at 19, 824 P.2d at 278. Mandamus may not be used to compel a discretionary act. Building & Constr. Trades v. Public Works, 108 Nev. 605, 609, 836 P.2d 633, 636 (1992); Young v. Board of County Comm'rs, 91 Nev. 52, 530 P.2d 1203 (1975). Therefore, because the Board has not failed to issue the bonds within a reasonable time and its decision was discretionary, we conclude the Board's vote was an appropriate exercise of discretion which does not warrant the issuance of a writ of mandamus.

Petitioners next argue that the bonds are exempt from the constitutional debt limitation because they concern a natural resource of Nevada. This court will not decide a constitutional issue unless necessary to the determination of a case. Williams v. State, 97 Nev. 1, 5 n. 4, 620 P.2d 1263, 1266 n. 4 (1981). Because the Board's exercise of discretion depended in part on our interpretation of A.B. 590 § 5(5) under the Nevada Constitution, we address this issue.

In Marlette Lake Co. v. Sawyer, 79 Nev. 334, 383 P.2d 369 (1963), this court held that the Nevada Constitution permitted the Legislature to authorize the State to exceed the debt limitation by purchasing private water rights and a distribution system. Relying on Marlette, petitioners contend that the Legislature has the power to decide what State actions protect and preserve its property and natural resources. However, in Marlette, the State itself was purchasing the water system from a private company. The issue was whether the fact that the system was still privately owned prevented a "natural resources" exemption under Article 9, § 3 of the Nevada Constitution. Id. at 338, 383 P.2d at 370-71. Unlike Marlette, in the instant case, the State does not own, or propose to own, any of the property which will benefit from the bonds. Furthermore, NRS 233C.220(3) ⁴ specifies the criteria that the Commission should use in awarding grants, and these same criteria are listed in the Commission's ten-year plan. However, only one of the seven funding criteria specifically addresses the preservation of property. Much of the criteria involves the programming element of cultural resources, and programming is not exempt from Nevada's debt limit. In sum, the property in question is not State-owned and it does not constitute "natural resources," nor are some of the bond funds designated for the preservation of property. Therefore, we conclude that the "cultural resources" in A.B. 590 § 5(5) are not exempt from the constitutional debt limitation under Article 9, § 3 of the Nevada Constitution, and therefore, the bonds in question are also not exempt from the constitutional debt limitation.

Alternatively, petitioners argue that this court should sever subsection 5 from § 5 of A.B. 590. Subsection 5 states that the issuance of the bonds shall be pursuant to the...