Burrell v. Mississippi State Tax Com'n

• Decision Date: 10 August 1988
• Docket Number: No. 58054,58054
• Citation: 536 So.2d 848
• Parties: Eddie BURRELL, et al., etc., Claiborne County Board of Supervisors v. MISSISSIPPI STATE TAX COMMISSION.
• Court: Mississippi Supreme Court

Page 848

536 So.2d 848

Eddie BURRELL, et al., etc., Claiborne County Board of Supervisors v. MISSISSIPPI STATE TAX COMMISSION.

No. 58054.

Supreme Court of Mississippi.

Aug. 10, 1988.

Rehearing Denied Jan. 18, 1989.

E. Clifton Hodge, Jr., Michael B. Wallace, Jean Hogan Sansing, Phelps, Dunbar, Marks, Claverie & Sims, Jackson, for appellants.

Edwin Lloyd Pittman and Mike Moore, Attys. Gen. by Robert E. Sanders, Sp. Asst. Atty. Gen., Jackson, for appellee.

En Banc.

ROBERTSON, Justice, for the Court:

I. Introduction and Overview

By no means the least insignificant effect of the advent of the Grand Gulf Nuclear Power Plant is the litigation it has spawned. For years political debate has raged regarding the authority to tax Grand Gulf and to enjoy the lagniappe thus generated. Today's appeal tests the legality of the political solution.

For the reasons enumerated below, we find in state law no legal infirmity in the scheme devised. Taxpayers residing in Grand Gulf's home county, however, have asserted claims to relief under federal law, claims which ought be heard and decided on their merits someday, somewhere. As the federal courts have declined subject matter jurisdiction, we remand with instructions that Taxpayers' federal claims be heard within the concurrent jurisdiction of the Chancery Court.

II. Factual Context and Proceedings Below

The Mississippi Legislature, at its 1986 session, adopted House Bill No. 388 (H.B. 388) ¹ amending Miss.Code Ann H.B. 388 further provided that any such utility, in lieu of the taxes from which it was thus exempted, would be required to pay annually to the State Tax Commission a sum equal to two percent (2%) of the value of the plant as assessed by the State Tax Commission, but in no event less than $16,000,000.00 for any taxable year. In addition, H.B. 388 provided for distribution of those revenues to the situs county, the most populous incorporated municipality within the situs county, the state's general fund, and the in-state counties and municipalities served by the utility. The distribution plan favored the situs county, particularly in the early years following passage of the act. Under normal ad valorem taxation principles, however, the situs county would receive all of the revenues so generated.

Sec. 27-35-309. H.B. 388 exempted from county, municipal and district ad valorem taxes any in-state nuclear generating plant owned or operated by a public utility rendering electrical service within the state. The exemption applied to any such plant which was not (1) otherwise exempt from ad valorem taxes, or (2) owned or operated by an instrumentality of the federal government.

There is, of course, only one such nuclear generating plant in Mississippi at this time: the Grand Gulf Nuclear Power Plant located in Claiborne County. Taxpayers are residents of Claiborne County and are of the view that their county is entitled to all of the ad valorem tax revenues generated by the plant, the same as would be the case for any other assessable and taxable properties within the county. To that end, Eddie Burrell and eight others (hereinafter "Taxpayers"), on August 6, 1986, filed a complaint in the Chancery Court for the First Judicial District of Hinds County. Burrell and four of his Co-Taxpayer Plaintiffs have sued individually and as members of the Claiborne County Board of Supervisors. The other four have sued as taxpayers and citizens of Claiborne County, as private attorneys general, if you will. See Canton Farm Equipment, Inc. v. Richardson, 501 So.2d 1098, 1106 (Miss.1987). Named as Defendant is the Mississippi State Tax Commission as the agency charged by law with preparing the public utilities assessment roll for each county.

In their complaint Taxpayers seek (1) an order declaring that H.B. 388 and certain purported amendments to the Mississippi Constitution of 1890 are null and void, (2) an injunction restraining enforcement of those provisions, and (3) an injunction mandating that the State Tax Commission issue an assessment roll permitting Claiborne County to tax the Grand Gulf nuclear facility as it would any other property within the county, notwithstanding the provisions of H.B. 388.

On motion of the Commission, the Chancery Court dismissed the complaint with prejudice, holding H.B. 388 (the law exempting Grand Gulf from county tax and imposing a state tax) constitutional and valid legislation. From that dismissal, the Taxpayers appeal, raising five (5) issues.

III. Summary of Issues Presented

We consider the case the parties have presented and as they have presented it. Structurally, Taxpayers first argue that H.B. 388 violates the pre-1983 version of Miss. Const., Art. 4, Sec. 112 (1890). Assuming such a violation--which we find--the question becomes whether H.B. 388 may be saved by two amendments to Section 112, S.C.R. 519 ratified in 1983 and H.C.R. 41, ratified June 3, 1986. ² Even if H.C.R. 41 has been validly incorporated into the Constitution, H.B. 388 must hurdle two further obstacles Taxpayers would interpose. First, Taxpayers note that H.B. 388 was enacted in April of 1986, some two months before the validating amendment to Section 112, an amendment possessing no retroactive validation power, or so we are told. Second, Taxpayers charge that H.B. 388 should in law be declared local and private legislation. If this be so, Taxpayers charge that it runs afoul of the substantive limitations of Miss. Const. Art. 4, Sec. 90(h) (1890) prohibiting tax exemptions and the procedural requirements of Miss. Const. Art. 4, Sec. 89 (1890) requiring submission to the local and private committees of each legislative house.

Finally, Taxpayers assert error in the Chancery Court's denial of their eleventh hour motion for leave to amend their complaint to assert claims under the Equal Protection Clause of the U.S. Const., Amdt. XIV, Sec. 1.

IV. The Claims Under "Old" Section 112

The first point need not detain us. Suffice it to say that Taxpayers present a powerful case that H.B. 388 fails under unamended, pre-1983 Section 112 on at least two fronts. First, H.B. 388 violates the uniformity and equality clause, see, Washington County Board of Supervisors v. Greenville Mill, 437 So.2d 401, 403 (Miss.1983) and State Tax Commission v. Fondren, 387 So.2d 712, 723-24 (Miss.1980). Old Section 112 did not allow the sort of pretended exemption plus in-lieu tax provided in H.B. 388. See Chicago Rock Island & Pacific Railroad Company v. Robertson, 122 Miss. 417, 84 So. 449 (1920); see also Ethridge, Mississippi Constitution 227, 336-40 (1928). Second, H.B. 388 But Section 112 has been amended. There is no need to consider further the serious constitutional questions here presented unless and until we determine H.B. 388 unconstitutional under Section 112 as it now reads, the matter to which we now turn.

violates old Section 112 in that it denies Claiborne County the power to tax Grand Gulf which is and ought be taxable property of that county. On this latter point, we regard Brennan v. Mississippi Home Insurance Company, 70 Miss. 531, 13 So. 228 (1893) as incorrectly decided and of quite dubious precedential value.

V. Have The People Validly Amended Section 112?

In 1983 and again in 1986, the legislature submitted to the electorate a proposed amendment to Section 112. Each in turn was ratified by the voters. Each amendment is here challenged, the 1983 amendment for lack of power and the 1986 amendment for having been submitted to the electorate in a manner inconsistent with the Constitution.

We consider the 1986 amendment first, where our question on the merits is whether that amendment illegally combined into one what in legal reality are two separate and distinct amendments. If the 1986 amendment survives this challenge and is valid--and if it possesses ratifying power regarding H.B. 388, our assumption that H.B. 388 violates the "old" Section 112 is of limited consequence. Similarly, Taxpayers' attack upon the 1983 amendment loses much of its sting.

The form and procedure for amending our Constitution are themselves matters of constitutional mandate. Taxpayers argue that the form in which the 1986 amendment was submitted to the voters contravened those strictures. Miss. Const., Art. 15, Sec. 273 (Supp.1987). Concretely, H.C.R. 41 presented to the voters the nuclear power plant classification here at issue coupled with a general property classification system for ad valorem taxation purposes. This we are told had the legal effect of combining into one submission two separate and distinct amendments, contrary to Section 273.

The evolution of Section 273 aids understanding. Prior to 1959, Section 273, in relevant part, provided that

... if more than one amendment shall be submitted at one time, they shall be submitted in such a manner and form that the people may vote for or against such amendment separately....

Miss. Const., Art. 15, Sec. 273 (1958).

In 1959, that portion of Section 273 was validly amended to provide as follows:

... if more than one amendment shall be submitted at one time, they shall be submitted in such manner and form that the people may vote for or against each amendment separately; and, notwithstanding the division of the Constitution into sections, the Legislature may provide in its resolution for one or more amendments pertaining and relating to the same subject or subject matter, and may provide for one or more amendments to an article of the Constitution pertaining and relating to the same subject or subject matter, which may be included in and voted on as one amendment....

Our question is whether H.C.R. 41 runs afoul of post-1959 Section 273. Does H.C.R. 41 submit to the electorate multiple amendments which under a faithful reading of Section 273 is proscribed? If the answer be, "No," we need pursue this assignment of error no further. Any infirmity in the 1983 amendment, S.C.R. 519, becomes moot as it was carried forward in...