City of Bridgeport v. Town of Stratford
| Decision Date | 29 July 1955 |
| Citation | 116 A.2d 508,142 Conn. 634 |
| Parties | CITY OF BRIDGEPORT v. TOWN OF STRATFORD (three cases). Supreme Court of Errors of Connecticut |
| Court | Connecticut Supreme Court |
Edward Bulter, with whom was Henry J. Lyons, Bridgeport, for appellant (defendant).
John V. Donnelly, Bridgeport, for appellee (plaintiff).
Before INGLIS, C. J., and O'SULLIVAN, WYNNE, DALY and PHILLIPS, * JJ.
O'SULLIVAN, Associate Justice.
The plaintiff city instituted the abovecaptioned cases for the purpose of challenging the validity of certain taxes laid by the defendant town against real and personal property owned and used by the plaintiff in connection with the operation of its municipal airport, which lies within the territorial limits of the defendant. Case No. 4061 was directed against the tax laid in 1951; case No. 4062 against that of 1950; and case No. 4063 against those of 1946 to 1949, inclusive. The actions were brought under the authority of General Statutes, § 1801, the pertinent part of which is set forth in the footnote, 1 and in each instance the plaintiff alleged, as the cause for relief, that the property was exempt from taxation. The court rendered judgment for the plaintiff as to the taxes laid in 1949, 1950 and 1951, but for the defendant as to the taxes laid in 1946, 1947 and 1948, the ruling as to these being that the plaintiff could not question their validity since it had failed to bring actions attacking them within the time limitation imposed by § 1801. Whether that ruling was correct we need not determine, since the only appeals before us were taken by the defendant and are concerned solely with the judgments as they determined the invalidity of the taxes laid in 1949, 1950 and 1951.
The finding is not subject to correction. It recites the following facts: During 1928, a private corporation acquired a substantial tract of land in the town of Stratford and on it constructed and thereafter ran an airport. In 1937 the airport had deteriorated and become unusable except by small aircraft. During a part of that year it was entirely closed to air traffic. For a number of years before 1937, business and industrial interests had urged the plaintiff to buy the airport in order to provide adequate air service for Bridgeport and surrounding towns. The plaintiff finally yielded to the urging and in May, 1937, bought the airport for $115,000. At that time it had an area of approximately 260 acres and consisted of an airfield located on the westerly side of Main Street in Stratford and a seaplane channel of 10.35 acres located on the opposite side of Main Street and extending therefrom to the Housatonic River. Immediately after buying the property, the plaintiff proceeded to improve it and to enlarge its facilities. This was done largely in conjunction with the Works Progress Administration. Three runways, each 3700 feet long and 400 feet wide, were built. A large addition was made to one of the hangars, the administration building was renovated, and a restaurant, known as Happy Landing Inn, was completely overhauled and re-equipped. The cost of these improvements was $112,000 to the plaintiff and $1,225,000 to the federal government.
On December 8, 1941, the United States air force seized the airport, and it was thereafter maintained by the armed forces as a part of national defense. During the period of seizure, the airport, at great expense to the United States, was substantially enlarged by the acquisition of additional land and was improved by adding 1000 feet to the runways and by the erection of hangars and other buildings. On June 7, 1946, the federal government turned the property back to the plaintiff. The latter thereupon resumed control of everything except two test hangars which the government had erected; it continued to remain in possession of these until September 30, 1949. On February 3, 1949, the government conveyed to the plaintiff without cost all of the property acquired during the period of federal occupation. This grant was by deed and was made subject to the condition that the property was to be used only for airport purposes. The plaintiff has since maintained the property, now consisting of 370 acres, as an airport.
Prior to October 1, 1946, the defendant laid no tax against the plaintiff by reason of its ownership of the property in question. Beginning, however, with the tax list of 1946, as to the realty comprising the airport, and with the list of 1949, as to the personalty located thereon, the defendant has laid taxes against the plaintiff in a steadily increasing amount, until the tax on the list of 1951 reached almost $43,000. 2 Other facts will be stated in the discussion of the specific problems presented by the appeals.
The plaintiff contends that its property in Stratford is exempt from taxation by virtue of General Statutes, § 1753, quoted in full in the footnote. 3 The fundamental issue presented by the appeals is whether the trial court was correct in agreeing with that contention.
Section 1753 exempts a town or city from taxation upon real and personal property located in another town and used for an airport. The exemption thus granted is made available as long as, first, the town or city owning the property continues to use it for airport purposes and, second, the town in which it lies has the same privileges in using the airport as the municipality owning it. So far as this portion of the statute is concerned, the plaintiff obviously qualifies for the tax exemption, and no claim to the contrary is made by the defendant.
The statute then proceeds to enumerate two conditions, the existence of either of which destroys the exemption and subjects the property to taxation. The first is that the airport may not be leased to any person, association or private corporation. This condition is not applicable to the case at bar. The other condition is that the airport shall not be used 'in such manner as to become a source of profit to the municipality owning the same.' It is this condition which serves the defendant's real contention. To point it up as well as to meet it, we refer to certain unchallenged findings of the court. The findings establish these facts: A restaurant is located at the airport and is under the management and control of the plaintiff's park department. The annual expenditures made in operating the restaurant have always exceeded the income derived from it. Apart from the restaurant for the fiscal years, ending March 31, which are involved in these appeals, the receipts from all airport operations and the expenditures made for the airport, its operation and maintenance, were these:
For 1948-1949
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Expenditures .. $ 83,158.98
Receipts ........ 35,946.94
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Deficit ...... 47,212.04
For 1949-1950
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Expenditures ... 146,896.89
Receipts ........ 58,392.98
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Deficit ...... 88,503.91
For 1950-1951
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Expenditures ... 112,772.47
Receipts ........ 64,644.73
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Deficit ...... 48,127.74
The defendant challenges the force and validity of these figures because, it contends, they are not the result of approved methods of accounting. The specific criticism is that the expenditures for capital outlays are not spread over the years of useful life of the permanent improvements but are allocated only to the fiscal year in which payment was made. In other words, the defendant objects to the determination of profit at the airport on the receipts-disbursement basis which the plaintiff has adopted. That the accrual approach rather than the cash method achieves a more objective and scientific result cannot, in all probability, be successfully gainsaid. For this reason it is usually held in higher repute among accountants. Shugerman, Accounting for Lawyers, p. 152. But we are here dealing with a municipal corporation whose powers and duties are not determined by the opinion of accountants, valuable as that opinion might be in other fields, but are both prescribed and circumscribed by the General Assembly. It would be of no moment that the accrual approach would produce a more accurate profit and loss statement of operations at the Bridgeport airport, if it should appear that the General Assembly has required the plaintiff to follow the cash method. That method, as it applies to municipal corporations, has not been without its champions. Oakey, Principles of Government Accounting & Reporting, p. 395 et seq.; see City of Newport News v. Warwick County, 159 Va. 571, 595, 166 S.E. 570, 167 S.E. 583. We call attention to this because it might be possible under the legislative requirements set forth in the Bridgeport charter to justify the practice observed by the plaintiff with respect to capital outlays. Bridgeport Charter, §§ 83, 95 (1939). We do not, however, rest our decision on that ground but prefer to rely on two other reasons in support of the judgments of the trial court.
The defendant has devoted a considerable part of its brief to a competent discussion of accountancy and of the methods of capitalizing and depreciating assets. But this is largely beside the point and it must give way to the decisive problem presented by the appeals. That problem is to construe § 1753 of the General Statutes. City of Stamford v. Town of Stamford, 107 Conn. 596, 605, 141 A. 891, 894.
The policy of the state has been to foster aviation and, as a means of attaining this objective, to encourage the development and maintenance of municipal airports. 4 This policy finds...
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