City of Wasilla v. Wilsonoff, S-377

• Decision Date: 19 April 1985
• Docket Number: No. S-377,S-377
• Citation: 698 P.2d 656
• Parties: CITY OF WASILLA, Appellant, v. William WILSONOFF and Leona Wilsonoff, Appellees.
• Court: Alaska Supreme Court

Page 656

698 P.2d 656

CITY OF WASILLA, Appellant, v. William WILSONOFF and Leona Wilsonoff, Appellees.

No. S-377.

Supreme Court of Alaska.

April 19, 1985

Kathleen C. Barron, Schanen Law Firm, Wasilla, for appellant.

Therese A. McGuire, Lynch, Farney and Crosby, Anchorage, for appellees.

Before RABINOWITZ, C.J., BURKE, MATTHEWS, COMPTON and MOORE, JJ.

OPINION

MOORE, Justice.

This case involves a dispute between the City of Wasilla ["city"] and city residents, the Wilsonoffs, about an assessment the city levied against the Wilsonoffs' property for a percentage of the cost of a new municipal water system. The Wilsonoffs requested an exemption from the city's assessment rolls, contending that the municipal water system would not benefit their property. The city council denied their request. On appeal the superior court reversed the city council's decision, holding that the council abused its discretion by levying an assessment against the Wilsonoffs' property. We reverse the superior court and affirm the city council's decision because the Wilsonoffs failed to overcome the presumption of correctness that accompanied the city's assessment determination.

I. FACTS

On June 28, 1978 the city council of the City of Wasilla enacted Resolution No. W78-S-4 to establish a municipal water system. Pursuant to their resolution, the city council assessed the real property located within the water improvement district for the water project's cost, allocating the assessments by determining the proportional share of benefit each property owner received from the installation of the municipal water system.

The Wilsonoffs own a lot in the Shadowood Valley Subdivision in Wasilla. The city council included this property within the water improvement district and assessed the Wilsonoffs $4,235.53 for the benefit they would receive by their proximity to the Nelson Avenue water main. The Wilsonoffs objected, claiming the water main could not benefit their property due to the topography of their lot.

At two public hearings held in May 1982, the Wilsonoffs presented arguments supporting their position. First, they contended that it would not be economically feasible to pump city water up the steep embankment between the Nelson Avenue main and their house. Second, the Wilsonoffs maintained that building restrictions prevented them from subdividing their lot and developing the southern portion bordering the city water main. Finally, the Wilsonoffs claimed that the fire hydrant installed on the southeastern corner of their lot did not provide them with either increased fire protection or a reduction in fire insurance rates.

The city council voted to exempt the Wilsonoffs from the mandatory hookup requirement, but not from the assessment. The Wilsonoffs appealed the city council's decision to the superior court. In February 1984 the superior court reversed the city council. The court held that the city abused its discretion in ordering an assessment on the Wilsonoffs' property due to "insufficient evidence in the record to support the finding by the [city] council to support assessment of [the Wilsonoffs'] property." The court then denied the city's motion for reconsideration or, in the alternative, a new trial.

II. DISCUSSION

A. Benefit under an Assessment

The city maintains that the Wilsonoffs were not exempt from the assessment roll because their property derived a benefit from the municipal water system. Under Alaska law only property benefited by a municipality's improvement plan is subject to an assessment. AS 29.63.020(b). Furthermore, a city council's assessment must be in proportion to the benefit received. AS 29.63.040(a). As the city correctly pointed out, however, the benefit to the assessed property does not have to be immediate. In 2 C. Antieau, Municipal Corporation Law, § 14.34 (1985), Professor Antieau states:

In determining whether particular properties have received sufficient benefits to make the assessments on these tracts legal, courts do not limit their inquiry to the uses to which the properties are presently put, but consider all uses to which the property, now and in the future, can legally and practically be put.

The territorial district court addressed the issue of "benefit" to assessed property in Kissane v. City of Anchorage, 17 Alaska 514, 159 F.Supp. 733 (D.C.Alaska 1958). The court upheld a special assessment for a parking garage against a residential property owner. Although the improvement did not result in any immediate benefit, the property's market value increased as a potential business site due to the availability of city parking. The court held that because the property received some "benefit, gain or advantage" from the improvement, the assessment could not be considered "so arbitrary or unjust as to render the method of assessment invalid as a matter of law." Id. 159 F.Supp. at 738. The court stated its position as follows:

It is not essential that the benefits must be direct or immediate, although it is essential that they be based on more than mere speculation or conjecture.

Id. at 737.

B. Burden of Proof

We agree with the city that its special assessment determination carries with it a "presumption of correctness."

If the apportionment of special assessments and the question of benefits are matters upon which reasonable men may differ, the determination by the municipal authorities will be sustained by the courts.

2 C. Antieau, Municipal Corporation Law, § 14.46 (1985).

The Kissane court, in adopting this majority position, noted:

It has also been generally held that the determination of assessments by municipal corporations ... is a matter of the city council acting in its legislative capacity, ... such determination is conclusive, in the absence of fraud or conduct so arbitrary as to be the equivalent...