Cape Motor Lodge, Inc. v. City of Cape Girardeau

• Decision Date: 25 March 1986
• Docket Number: No. 67507,67507
• Citation: 706 S.W.2d 208
• Parties: 31 Ed. Law Rep. 630 CAPE MOTOR LODGE, INC., et al., Respondents, v. CITY OF CAPE GIRARDEAU, Missouri, et al., Appellants.
• Court: Missouri Supreme Court

Page 208

706 S.W.2d 208

31 Ed. Law Rep. 630

CAPE MOTOR LODGE, INC., et al., Respondents, v. CITY OF CAPE GIRARDEAU, Missouri, et al., Appellants.

No. 67507.

Supreme Court of Missouri,

En Banc.

March 25, 1986.

Webb R. Gilmore, Ronald L. Blunt, Kansas City, Joseph J. Russell, Diane C. Howard, Fred Boeckmann, Cape Girardeau, Bruce E. Woodruff, John Warshawsky, St. Louis, for appellants.

Walter S. Drusch, Cape Girardeau, for respondents.

HIGGINS, Chief Justice.

The City of Cape Girardeau appeals summary judgment for Cape Motor Lodge, et al., declaring that the City lacked authority to construct and operate a multi-use center jointly with the Board of Regents of Southeast Missouri State University. The City contends the trial court erred in declaring unconstitutional, illegal and unenforceable: the "Multi-Use Center Agreement" between the City and SEMO; ordinance 174 authorizing the agreement; ordinance 190 authorizing the issuance of general obligation bonds to finance the City's costs for the project and levying a property tax to retire the bonds; and a portion of ordinance 101 levying a gross receipts license tax on hotels, motels, and restaurants to assist in retiring the bonds. The judgment is reversed and remanded.

The City of Cape Girardeau is a constitutional charter city. Mo. Const. art. VI, § 19. In 1982, an advisory committee composed of City officials, SEMO officials and members of the City's business community proposed that SEMO and the City jointly finance, construct and operate a $12.9 million Multi-Use Center, the City to finance $5 million of the cost with general obligation bonds and SEMO to finance the remaining $7.9 million of the cost with state appropriations. On April 5, 1983, the people of the City approved the proposition by a vote of 72.8% to 27.2%.

On September 21, 1983, the City Council enacted ordinance 101 which levied a license tax on hotels and motels in an amount equal to 3% of gross receipts derived from sleeping accommodations and on restaurants in an amount equal to 1% of gross receipts derived from food sales, the revenues to be used to retire the bonds and promote conventions, tourism and economic development. The people of the City approved the tax by a vote of 61.4% to 38.6%.

The City and SEMO then drafted the Multi-Use Center Agreement. The agreement provided: SEMO and the City will jointly design, construct, furnish and equip the Multi-Use Center with 5/13 of the costs to be born by the City and 8/13 by SEMO; upon the recommendation of a citizens' advisory committee, the Multi-Use Center will be located on SEMO campus and SEMO will hold title to the property and own the building; the Multi-Use Center will be available for a variety of SEMO and community uses, supervised by a six-member Board of Managers, three to be appointed by the City and three by SEMO; and SEMO will be responsible for the costs of operating and maintaining the building. SEMO approved and authorized execution of the Multi-Use Center Agreement; the City Council did the same by enacting ordinance 174. On October 31, 1984, the agreement was executed and the City enacted ordinance 190 authorizing issuance of its general obligation bonds in the amount of $5 million.

On December 26, 1984, respondents, a group of local hotel, motel and restaurant owners and operators, sought declaratory judgment and injunction alleging: the City has no authority to enter into the agreement and therefore the agreement and ordinance 174 authorizing the agreement, are invalid; ordinance 190 authorizing the issuance of the bonds and the levy of an ad valorem tax, is invalid; and ordinance 101 authorizing the levy of the hotel, motel and restaurant tax, is invalid. In its summary judgment, the trial court ruled: the City does not have the power to authorize or enter into the Multi-Use Center Agreement because SEMO is not an entity named in either Mo. Const. art. VI, § 16, or section 70.220, RSMo 1978; that ordinances 190 and 101, to the extent they levy taxes for the payment of the bonds issued to finance the City's cost of the Multi-Use Center, are invalid because the taxes are not in furtherance of either a "public purpose" within the meaning of Mo. Const. art. X, § 3, or a "municipal purpose" within the meaning of Mo. Const. art. X, § 1. The trial court enjoined the City from implementing the agreement and the ordinances.

The City contends that this Court should be guided by Missouri's constitutional home rule provision set forth in Mo. Const. art. VI, § 19(a), and that execution of the Multi-Use Center Agreement between the City and SEMO and ordinance 174 were proper exercises of the City's powers derived from the home rule provision. Section 19(a) of article VI of the constitution provides:

Power of charter cities, how limited. Any city which adopts or has adopted a charter for its own government, shall have all powers which the general assembly of the state of Missouri has authority to confer upon any city, provided such powers are consistent with the constitution of this state and are not limited or denied either by the charter so adopted or by statute. Such a city shall, in addition to its home rule powers, have all powers conferred by law.

Section 19(a) grants to a constitutional charter city all the power which the legislature could grant. St. Louis Children's Hospital v. Conway, 582 S.W.2d 687, 690 (Mo.banc 1979). Prior to the adoption of section 19(a) in 1971, this Court felt compelled to find some grant of authority in the constitution, statutes or the charter. See Halbruegger v. City of St. Louis, 302 Mo. 573, 262 S.W. 379, 384 (banc 1924). Under section 19(a), in the absence of an express delegation by the people of a home rule municipality in their charter, the municipality possesses all powers which are not limited or denied by the constitution, by statute, or by the charter itself. Hannah ex rel. Christ v. City of St. Charles, 676 S.W.2d 508, 512 (Mo. banc 1984). Recognizing the City's power is derived from section 19(a), the question becomes: Are the agreement and ordinance 174 "consistent with the constitution of this state and ... not limited or denied either by the charter so adopted or by statute."? Mo. Const. art. VI, § 19(a). See Frech v. City of Columbia, 693 S.W.2d 813 (Mo. banc 1985). Respondents argue that the City is without authority to enter into the Multi-Use Center Agreement with SEMO by the terms of Mo. Const. article VI, section 16, and section 70.220, RSMo 1978. Section 16 of article VI of the constitution provides:

Cooperation by local governments with other governmental units. Any municipality or political subdivision of this state may contract and cooperate with other municipalities or political subdivisions thereof, or with other states or their municipalities or political subdivision, or with the United States, for the planning, development, construction, acquisition or operation of any public improvement or facility, or for a common service, in the manner provided by law.

The enabling statute, section 70.220, RSMo 1978, provides:

Political subdivisions may cooperate with each other, with other states, the United States or private persons.--Any municipality or political subdivision of this state, as herein defined, may contract and cooperate with any other municipality or political subdivision, or with an elective or appointive official thereof, or with a duly authorized agency of the United States, or of this state, or with other states or their municipalities or political subdivisions, or with any private person, firm, association or corporation, for the planning, development, construction, acquisition or operation of any public improvement or facility, or for a common service; provided, that the subject and purposes of any such contract or cooperative action made and entered into by such municipality or political subdivision shall be within the scope of the powers of such municipality or political subdivision.

Respondents argue that the City did not have the power to enter into the Multi-Use Center Agreement because SEMO is neither a "municipality or political subdivision" under the constitution and section 70.220, nor a "duly authorized agency of this state" under section 70.220. Respondents assert that section 16 of article VI and section 70.220 delineate with particularity the entities which may enter into cooperative agreements with a municipality; and that section 70.220 and section 16 of article VI do not provide for cooperative agreements with state colleges. Therefore, respondents contend that the City has exercised a power limited by statute and the constitution--thereby directly violating Mo. Const. art. VI, § 19(a).

This analysis was rejected in Frech. The City of Columbia had enacted an ordinance which authorized the municipal judge to issue search warrants for administrative searches conducted in connection with the City's licensing procedure of apartment houses and rooming houses. Plaintiffs contended that because the subject matter of the ordinance was not included in chapter 542, RSMo 1978, which governs the procedure applicable to the issuance of search warrants in criminal proceedings, the City had therefore exercised a power limited by statute; further, plaintiffs contended that the ordinance was inconsistent with this Court's constitutional authority to promulgate rules of practice and procedure for Missouri courts. This Court determined that chapter 542 neither expressly nor implicitly prohibits what the ordinance permits and that the ordinance neither impinges upon nor conflicts with this Court's constitutional authority to promulgate rules of practice and procedure for municipal courts. Accordingly, the ordinance was held not to violate article VI, section 19(a). Id. at 815-16.

Under section 19(a), the emphasis no longer is whether a home rule city has the authority to exercise the power involved; the emphasis is whether the exercise of...