Granite Falls Library Capital Facility Area v. Taxpayers of Granite Falls Library Capital Facility Area

• Decision Date: 09 April 1998
• Docket Number: No. 64779-8,64779-8
• Citation: 953 P.2d 1150,134 Wn.2d 825
• Court: Washington Supreme Court
• Parties: GRANITE FALLS LIBRARY CAPITAL FACILITY AREA, Respondent, v. The TAXPAYERS OF GRANITE FALLS LIBRARY CAPITAL FACILITY AREA, Appellants.

Page 825

134 Wn.2d 825

953 P.2d 1150

GRANITE FALLS LIBRARY CAPITAL FACILITY AREA, Respondent, v. The TAXPAYERS OF GRANITE FALLS LIBRARY CAPITAL FACILITY AREA, Appellants.

No. 64779-8.

Supreme Court of Washington,

En Banc.

Argued Sept. 17, 1997.

Decided April 9, 1998.

Anderson, Hunter, Dewell, Baker & Collins, G. Douglas Ferguson, Joni Larson, Everett, for Appellants

Daniel S. Gottlieb, Riddell, Williams, Bullitt & Walkinshaw, Paul Kundtz, Elizabeth Kennar, Seattle, for Respondent.

SMITH, Justice.

Appellants The Taxpayers of Granite Falls Library Capital Facility Area seek review of a decision of the Snohomish County Superior Court which granted summary judgment in favor of Respondent Granite Falls Library Capital Facility Area, a Washington quasi-municipal corporation, ruling (a) that the Library Capital Facility Act, RCW Chapter 27.15, was constitutional; (b) that Respondent has the legal right and authority to sell and issue

unlimited tax obligation bonds and that such bonds are valid; (c) that Respondent is a separate municipal corporation and independent taxing authority with authority to levy taxes within the meaning of Article VII, Section 1 and Article VII, Section 2 of the Washington Constitution; and (d) that the Act satisfies the constitutional guaranties of equal protection, due process and right of suffrage. We granted review. We affirm the Superior Court.

QUESTIONS PRESENTED

The questions presented in this case are: (1) whether the Library Capital Facility Act, RCW 27.15 (the Act), authorizing creation of the Granite Falls Library Capital Facility Area (Library Facility Area) as a separate quasi-municipal corporation with taxing authority results in uniform taxes required by Article VII, Section 1 and Article VII Section 9 of the Washington Constitution; (2) whether the Act, as required by Article XI, Section 12 of the Washington Constitution, properly delegates the taxing authority; (3) whether the Act and creation of the Granite Falls Library Capital Facility Area satisfy the constitutional guaranties of equal protection and due process under the fourteenth Amendment of the United States Constitution and the right of suffrage under Article I, Section 19 of the Washington Constitution; and (4) whether Appellant's designated representatives are entitled to attorney fees on appeal.

STATEMENT OF FACTS

This case comes before the Court on stipulated facts. ¹ The parties stipulated the Act was passed by the Washington Legislature in 1995. The statute permits establishment of "library capital facility areas" defined as quasi-municipal corporations and independent taxing districts within the meaning of Article VII, Section 1 of the Washington Constitution On August 23, 1995, the City Council of Granite Falls (City Council) approved submission of a joint request with the Sno-Isle Intercounty Rural Library District to the Snohomish County Council (County Council) to establish the Granite Falls Library Capital Facility Area. The request provided for issuance of general obligation bonds and imposition of an excess levy to finance acquisition and construction of the library facility. ² The City Council approved it for placement on the ballot. The trustees of the Sno-Isle Rural Library on August 28, 1995 approved the proposition. ³

and independent taxing authorities within the meaning of Article VII, Section 2 of the Washington Constitution.

On September 1, 1995, the Sno-Isle Library System resolution, the City Council resolution and the Joint Request and Operating Agreement ⁴ were submitted to the Snohomish County Council. As required by the Act (RCW 27.15), the request included resolutions and a description of the boundaries of the Library Facility Area, which was coterminous with the boundaries of Granite Falls School District Number 332.

On September 20, 1995, the County Council called for a special election for the two propositions within the Library Facility Area to be held with the general election on November 7, 1995. ⁵ Formation of the Library Facility Area was approved by a majority of votes cast at that election. At least 40 per cent of the votes cast in the last preceding general election were cast on November 7, 1995 with at The Snohomish County Council then appointed the "Governing Body" of the Library Facility Area. ⁷ The Governing Body adopted its bylaws ⁸ and a resolution authorizing the sale and issuance of unlimited tax obligation bonds in the aggregate principal amount of $1.6 million, as authorized by the statute and approved by the voters of the Library Facility Area. ⁹ The Governing Body entered into an Interlocal Agreement with the Sno-Isle Library System and the City of Granite Falls to govern the ownership, management and operation of the library capital facility financed by the Library Facility Area in accord with the statute. ¹⁰

least three-fifths of those votes approving the proposition. The voters authorized the Library Facility Area to issue up to $1.6 million in general obligation bonds maturing within 20 years for the acquisition and construction of a library capital facility, and approved the levy of annual excess property taxes necessary to pay and retire the bonds. ⁶

The total assessed value of all taxable property within the Library Facility Area in 1995 was $360,811,319. Bonds issued in the full amount of $1.6 million would not subject the Library Facility Area to obligation on indebtedness in excess of an amount equal to one and one-quarter percent The parties also stipulated that the Act imposed the following obligations upon the Library Facility Area in the future: the governing body of the Library Facility Area must determine whether the bonds will be issued in one or more series; must establish one or more maturity dates for the bonds; and must establish the interest rate or rates to be paid on the bonds. The bonds would be issued in the name of the Library Facility Area and would constitute general obligations of the Library Facility Area, which is solely liable for the bonds.

of the value of the taxable property within the Library Facility Area.

After issuance of the bonds, the governing body would levy excess property taxes on a yearly basis upon all the taxable property in the Library Facility Area at a rate sufficient to pay the principal and interest on the bonds. The rate is substantially dependent upon, and would vary directly with, the rate of interest the governing body establishes to be paid on the bonded indebtedness. The rate of tax would be uniform on the same class of property located within the geographical boundaries of the Library Facility Area.

The Library Facility Area is situated mostly within Snohomish County Council District Number 1, with several parcels within Snohomish County Council District Number 5. Snohomish County Council District Numbers 2, 3 and 4 have no property within the Library Facility Area. Snohomish County is organized and operated under the Home Rule Charter ¹¹ as permitted by the Washington Constitution and the laws of the State of Washington. Section 2.30 of the Charter states:

The county council shall consist of five members nominated and elected from districts. Councilmembers shall be residents and registered voters of the district they represent at the time of filing for election to said office and at all times during their terms. Any change in the boundaries of a councilmember's Only registered voters in a particular council district are permitted to vote for candidates nominated from such district and those registered voters are not permitted to vote for county council candidates from other districts. ¹³

district which shall cause [the councilmember] to be no longer a resident shall not disqualify [the councilmember] from holding office during the remainder of the term for which [the councilmember] was elected or appointed.[ ¹²

The case was presented to the Snohomish County Superior Court on cross motions for summary judgment. On November 1, 1996, the Honorable Gerald L. Knight granted summary judgment in favor of Granite Falls Library Capital Facility Area and denied Appellant's motion. ¹⁴ On November 2, 1996, Appellants, The Taxpayers of Granite Falls Library Capital Facility Area, filed a motion with this Court seeking direct review ¹⁵ which we granted on April 2, 1997. ¹⁶

DISCUSSION

STANDARD OF REVIEW

This case was resolved on cross motions for summary judgment in the Snohomish County Superior Court. This Court reviews a summary judgment de novo, treating all facts and inferences in a light most favorable to the nonmoving party. ¹⁷

"A party challenging the constitutionality of a

                legislative enactment bears the burden of proving, beyond a reasonable doubt, that the enactment is unconstitutional." 18  Statutory construction requires the Act be construed to give effect to the Legislature's intent, wherever possible. 19  In this case the constitutionality of the Act, RCW Chapter 27.15, is being challenged.
                

UNIFORMITY OF TAXES

Under the stipulated facts submitted to this Court, the parties agreed the taxes within the geographical boundaries of the Library Facility Area would be uniform. The dispute is on the question whether the tax will be imposed by the Library Facility Area or by the County Council. Appellants, The Taxpayers of the Granite Falls Library Capital Facility Area, contend the Act does not create or empower a sufficiently separate and independent taxing authority which is constitutionally distinct from Snohomish County, thus violating Article VII, Section 1, as amended by Amendment 81, and Article VII, Section 9, of the Washington Constitution.

Appellants claim the County Council is the true taxing authority and any taxes imposed on the Facility Area violates the constitution because it would not be imposed uniformly throughout Snohomish County. Appellants reason that the Act in effect vests the taxing authority in the county because the Library Facility Area's...