Great Northern Ry. Co. v. Severson

• Decision Date: 29 October 1951
• Docket Number: No. 7167,7167
• Citation: 50 N.W.2d 889,78 N.D. 610
• Parties: GREAT NORTHERN RY. CO. v. SEVERSON, County Treasurer.
• Court: North Dakota Supreme Court

Page 889

50 N.W.2d 889

78 N.D. 610

GREAT NORTHERN RY. CO. v. SEVERSON, County Treasurer.

No. 7167.

Supreme Court of North Dakota.

Oct. 29, 1951.

Rehearing Denied Jan. 23, 1952.

Syllabus by the Court.

1. The taxing power of a school district derives from the Legislature and school boards have no powers other than those which are conferred upon them by statute.

2. It is both a general and statutory rule of construction that the Legislature intends an act to operate prospectively only, unless the contrary appears.

3. Where the legislative intention with respect to a statute levying a tax is doubtful, the doubt must be resolved against the government and in favor of the taxpayer.

4. Chapter 359, SLND 1947, which amended Section 57-1514 RCND 1943 and raised the aggregate amount of tax that could be levied by any school district giving four years of standard high school work from 22 mills to 36 mills, is prospective in its operation and does not furnish an enlarged basis for applying the percentage of increase approved by the voters of a school district at an election held when the prior levy limit of 22 mills was in effect.

Nilles, Oehlert & Nilles, Fargo, for plaintiff and respondent.

Wallace E. Warner, Atty. Gen., P. O. Sathre, C. E. Brace, Asst. Atty. Gen., Lysle C. Boostrom, Nelson County State's Atty., Lakota, for defendant and appellant.

The Court having, on its own motion ordered reargument, E. T. Christianson, now Atty. Gen., and Nels G. Johnson, Special Asst. Atty. Gen., appeared for appellant.

MORRIS, Chief Justice.

Osago School District No. 58 is a common school district in the County of Nelson maintaining and operating a standard four year high school. On August 13, 1946, the governing board of the district unanimously adopted a resolution pursuant to the provisions of Section 57-1602 RCND 1943 declaring that the amount of taxes which may be raised at the maximum rate authorized by law would be insufficient to provide an adequate amount for the necessary requirements of the school district and that it was necessary to levy taxes in excess of the statutory levy limitation for the purposes of meeting the current expenses of the district to the extent of fifty per cent of that limitation for the years 1946 and 1947. The question of increasing the levy limit was submitted to the electors of the district at a special election on the 24th of September, 1946. The ballot stated the question as follows: 'Shall Osago School District No. 58 levy taxes for the year (or years) 1946, 1947, which shall exceed the legal limit by 50%, so that the taxes levied for this current year instead of being $4989.95, which is the limit authorized by law, shall be $7484.92?'

At this election 94 votes were cast in favor of the increase and 42 against.

At the time the proceedings were had to increase the levy limit, Section 57-1514 RCND 1943 was in effect, which authorized common school districts giving four years of standard high school work to levy taxes not to exceed twenty-two mills. The election had the effect of increasing that limit by fifty per cent, or by an additional eleven mills, making the total limit thirty-three mills, as authorized by the voters pursuant to the law then in effect.

Section 57-1514 RCND 1943 was amended and reenacted by Chapter 359, SLND 1947, that became effective July 1, 1947. Under that amendment a common school district giving four years of high school work may levy taxes not to exceed thirty-six mills.

The clerk of the school board of the district certified to the County Auditor of Nelson County for the year 1946 a levy of thirty-three mills, which was the maximum levy established by the electors of the district at the special election in 1946. Despite the fact that no other election was held in the district, the clerk of the school board, for the year 1947, certified a levy of 50.12 mills, which was 14.12 mills in excess of the thirty-six mill limitation established by Chapter 359, SLND 1947. This excess levy applied to the valuation of plaintiff's property amounts to $903.85. This amount the plaintiff paid under protest and now seeks to recover.

The plaintiff does not contest the right of the school district to levy thirty-six mills as prescribed by Chapter 359, SLND 1947, but challenges the right of the school district to use the 1946 election and the levy increase approved at that time as a basis for increasing the levy limit prescribed by Chapter 359, SLND 1947.

In this action the plaintiff also seeks to recover the sum of $315.03, paid under protest as an excess levy made by Aneta Special School District No. 20, for the year 1947. The district called and held an election in 1946 to increase the levy by twenty-five per cent, under the same statutes and procedure as that followed by Osago School District No. 58, except that the form of the ballot was as follows:

'Shall Aneta Special School District No. 20 levy taxes for the years 1946 and 1947 and 1948 which shall exceed the legal limit by 25% so that the taxes levied for those years, instead of being 5102.06 dollars, which is the limit authorized by law, shall be 6377.58 dollars?

Yes ___ No ___'

The election resulted in twenty-five votes for and one against the increase. The ballot used in this election did not conform to that prescribed by Section 57-1606, which provides:

'Upon the ballot the question shall be submitted in substantially the following form:

Shall _____ school district levy taxes for the year (or years) _____, which shall exceed the legal limit by _____ percent, so that the taxes levied for this current year instead of being _____ dollars, which is the limit authorized by law, shall be _____ dollars:

Yes [ ]

No [ ]' At the time the election was held in 1946, the legal levy limit was twenty-two mills, and the Clerk of Aneta School District certified the levy for that year at twenty-two mills, plus twenty-five per cent thereof, or 27 1/2 mills, which was the amount approved by the voters at the election. But in 1947 he certified the levy as forty-five mills. Thus he applied the twenty-five per cent increase to the new statutory limit of thirty-six mills provided by Chapter 359, SLND 1947. The plaintiff here challenges the right of the district to levy over thirty-six mills in 1947 and seeks to recover the excess of $315.03 which it paid under protest.

The facts are stipulated. The controversy is one of law. At the time the elections were held the levy limit for both districts was twenty-two mills. Osago authorized an increase of fifty per cent and Aneta authorized an increase of twenty-five per cent. 1946 taxes were levied by applying these increases to the base levy limit of twenty-two mills. The following year the Legislature increased the limit of the levy that could be made without an election to thirty-six mills. No further election was held in either district. The question is: Can the district authorities apply the percentage increases that were approved by the voters in 1946, when the limit was twenty-two mills, to the new limit of thirty-six mills that was established in 1947? The trial court answered this question in the negative and rendered judgment for the plaintiff.

School boards have no other powers than those which are conferred upon on them by the Legislature. Pronovost v. Brunette, 36 N.D. 288, 162 N.W. 300. The taxing power of a school district derives from the Legislature. The Legislature throughout the history of our state has meticulously circumscribed and limited the power of school boards to levy taxes by specific mill levy limitations which can be exceeded only by authority of the electors of the district in the manner prescribed by Chapter 57-16 RCND 1943. The Legislature has been careful to provide by statute the manner and method by which the consent of the electors to levy taxes in excess of the limitations otherwise provided by law may be obtained. The first step is a declaration by resolution of the governing board of the district that the amount of taxes which may be raised at the maximum rate authorized by law will be insufficient and that it is necessary to levy taxes in excess of the statutory limitations for the purpose of meeting current expenses of the district, not to exceed seventy-five per cent over the legal limitation. This resolution must be passed by a two-thirds vote of all of the members of the board. Section 57-1602 RCND 1943.

A special election may be called by the governing board of the school district for the purpose of voting upon the question of authorizing an excess levy, as was done by both districts in this case. The notice of election is prescribed in considerable detail. It must give the year or years for which authorization is sought, as well as the percentage of the excess levy which is to be voted upon. And the notice must, among other things, provide electors with this information:

'1. The total amount of income and expenditures of such school district for the fiscal year preceding;

'2. The estimated expenditures for the year for which the taxes are to be levied;

'3. The aggregate amount of the tax levy which the governing body seeks authority to make;

'4. The aggregate amount of tax levy permissible without special authority from the electors; and

'5. The amount of the tax levy in excess of the statutory limit which the board seeks authority to make.' Section 57-1603 RCND 1943.

Of particular importance in this case is the information required to be given the electors under figures 3 and 4 above, from which a comparison can be made by the voter between the amount that can be levied within the statutory limitation and the total or aggregate amount for which the school board seeks authority to levy.

As further indicating the safeguards provided for the right of the elector to express his approval or disapproval of an excess levy, we note the vote required by statute for such approval. A majority of the voters may authorize an...