Livingston County v. Department of Management and Budget, No. 79074

• Court: Supreme Court of Michigan
• Writing for the Court: BRICKLEY; RILEY; LEVIN
• Citation: 425 N.W.2d 65,430 Mich. 635
• Docket Number: No. 79074
• Decision Date: 20 June 1988
• Parties: , 27 ERC 2250 LIVINGSTON COUNTY and the Livingston County Board of Public Works, Plaintiffs-Appellees, v. DEPARTMENT OF MANAGEMENT AND BUDGET and Department of Natural Resources, Defendants-Appellants.

Page 65

425 N.W.2d 65 430 Mich. 635, 27 ERC 2250 LIVINGSTON COUNTY and the Livingston County Board of Public
Works, Plaintiffs-Appellees,
v.
DEPARTMENT OF MANAGEMENT AND BUDGET and Department of
Natural Resources, Defendants-Appellants. No. 79074. Supreme Court of Michigan. Argued Oct. 7, 1987.
Decided June 20, 1988.

Page 66

[430 Mich. 636] Larry A. Salstrom, Cohl, Salstrom, Stoker & Aseltyne, P.C., Lansing, for plaintiffs-appellees.

[430 Mich. 637] Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., Thomas L. Casey, Asst. Sol. Gen., Lansing, James E. Riley, Thomas J. Emery, Sheldon A. Silver, Asst. Attys. Gen., for defendants-appellants.

Sondee & Racine by: W. Peter Doren, Traverse City, for amicus curiae.

Dennis O. Cawthorne, James G. Cavanagh, Fitzgerald, Hodgman, Cox, Cawthorne & McMahon, Lansing, for amicus curiae Michigan Ass'n of Counties in support of plaintiffs-appellees.

OPINION

BRICKLEY, Justice.

This case involves an interpretation of the Solid Waste Management Act and Const. 1963, art. 9, Sec. 29, a provision of the Headlee Amendment, which in part, requires the state to appropriate funds to units of local government for the necessary increased costs associated with "an increase in the level of any activity or service beyond that required by existing law...." The specific question in this case is whether application of the provisions of the Solid Waste Management Act to plaintiff's sanitary landfill triggers art. 9, Sec. 29's state funding requirement. We hold that Const. 1963, art. 9, Sec. 29 applies only to services and activities required by state law and that operation of a sanitary landfill is not a required service or activity. Thus art. 9, Sec. 29 does not apply in this case. Therefore, we reverse the judgment of the Court of Appeals.

FACTS

In 1972 Livingston County began operating a sanitary landfill which was licensed pursuant to [430 Mich. 638] the garbage and refuse disposal act (GRDA), 1965 P.A. 87. In January, 1979, the GRDA was repealed and replaced with the more detailed and comprehensive Solid Waste Management Act (SWMA). 1978 P.A. 641, M.C.L. Sec. 299.401 et seq.; M.S.A. Sec. 13.29(1) et seq. Shortly before the adoption of the SWMA, the voters, in the election of November, 1978, amended the Michigan Constitution by adopting the Headlee Amendment, which provides, in part, that the state must appropriate funds for any necessary increased costs associated with "an increase in the level of any

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activity or service beyond that required by existing law...." ¹

In April, 1980, in order to comply with the SWMA and the rules and regulations promulgated thereunder, Livingston County signed a schedule of compliance with the State Department of Natural Resources. The county then proceeded to upgrade its landfill, undertaking hydrogeological studies and the installation of a leachate collection system and a PVC liner. The county sought reimbursement from the state for the landfill improvements, but the state disavowed any liability. The county then filed suit in the Court of Claims, which found defendant liable for $260,000 expended by plaintiff in upgrading its sanitary landfill.

"This Court must conclude that plaintiff has preponderated with the evidence to demonstrate that plaintiff upgraded its facility to comply with new and additional state mandated statutes and requirements under Act 641.... This Court further finds that the documented proofs clearly demonstrate that these expenditures totalled $260,000 which would not have been required had defendant[430 Mich. 639] not required compliance with Act 641." (Emphasis added.)

The Court of Appeals, in a per curiam opinion filed May 1, 1986, affirmed the Court of Claims decision, relying on two earlier Court of Appeals cases involving facts nearly identical to those in this case. ²

We granted leave and now reverse the judgment of the Court of Appeals. ³

ANALYSIS I

This case involves an interpretation of the Solid Waste Management Act and Const. 1963, art. 9, Sec. 29, a provision of the Headlee Amendment. Art. 9, Sec. 29 provides as follows:

"[430 Mich. 640] The state is hereby prohibited from reducing the state financed proportion of the necessary costs of any existing activity or service required of units of Local Government by state law. A new activity or service or an increase in the level of any activity or service beyond that required by existing law shall not be required by the legislature or any state agency of units of Local Government, unless a state appropriation is made and disbursed to pay the unit of Local Government for any necessary increased costs. The provision of this section shall not apply to costs incurred pursuant to Article VI, Section 18." Const. 1963, art. 9, Sec. 29 (emphasis added).

The first issue critical to the resolution of this case is whether the second sentence of art. 9, Sec. 29 applies to increases in the level of all services and activities, whether optional or required, that are carried on by units of local government or only to increases

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in the level of those services and activities that are required by state law. The argument made by amicus curiae for the Michigan Municipal League and the Michigan Townships Association goes to the heart of this issue.

"The Headlee Amendment states that a 'new activity or service ... shall not be required by the legislature or a state agency' and it states that 'an increase in the level of any activity or service beyond that required by existing law shall not be required by the legislature or any state agency....' Mich Const 1963, art 9, Sec. 29 (emphasis supplied). There is no qualification in the Headlee Amendment that the local governmental activity or service being increased by the state be a service or activity that is required to be performed by the local government. The Headlee trigger for state funding is a rise in the level of any local service, even an optional one, beyond the level required as of the Headlee effective date. The [430 Mich. 641] phrase 'that required' refers to the 'level' of 'any activity or service'.... It is not the service that need be 'required' under Headlee, but only the level." (Emphasis in original.)

The Court of Appeals in this case, as in Delta Co. v. Dep't of Natural Resources, 118 Mich.App. 458, 325 N.W.2d 455 (1982), 414 Mich. 954 (1982); and South Haven Twp. v. Dep't of Natural Resources, 132 Mich.App. 222, 346 N.W.2d 923 (1984), did not reach this issue. Instead, the Court found that the unit of local government was, in effect, required by the overall command of the SWMA to maintain its sanitary landfill, once undertaken.

We have dealt with art. 9, Sec. 29, a relatively new provision of the constitution, on only one occasion, in Durant v. State Bd. of Ed., 424 Mich. 364, 381 N.W.2d 662 (1985). While Durant is not on point, we did expound upon the scope and purpose of the Headlee Amendment. We explained that in ratifying Headlee the voters sought

"to gain more control over their own level of taxing and over the expenditures of the state. It is evident that while the voters were concerned about the general level of state taxation, they were also concerned with ensuring control of local funding and taxation by the people most affected, the local taxpayers. The Headlee Amendment [was] the voters' effort to link funding, taxes, and control." Id., p. 383, 381 N.W.2d 662.

We also concluded that the Headlee Amendment was "part of a nationwide 'taxpayer revolt' in which taxpayers were attempting to limit legislative expansion of requirements placed on local government...." Id., p. 378, 381 N.W.2d 662 (emphasis added).

In interpreting art. 9, Sec. 29, two basic rules of constitutional construction appear applicable.

"[430 Mich. 642] The primary rule is the rule of 'common understanding' described by Justice Cooley:

" 'A constitution is made for the people and by the people. The interpretation that should be given it is that which reasonable minds, the great mass of the people themselves, would give it. "For as the Constitution does not derive its force from the convention which framed, but from the people who ratified it, the intent to be arrived at is that of the people, and it is not to be supposed that they have looked for any dark or abstruse meaning in the words employed, but rather that they have accepted them in the sense most obvious to the common understanding...." (Cooley's Const Lim 81)....'

"A second rule is that to clarify meaning, the circumstances surrounding the adoption of a constitutional provision and the purpose sought to be accomplished may be considered." Traverse City School Dist. v. Attorney General, 384 Mich. 390, 405, 185 N.W.2d 9 (1971) (emphasis in original).

Unfortunately, application of these two rules of constitutional construction could produce contrary results. While an examination of the purpose of the Headlee Amendment and the circumstances surrounding its adoption indicate that the voters intended art. 9, Sec. 29 to apply only to required and not optional activities, it is

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argued, that a literal reading of the second clause of the second sentence of art. 9, Sec. 29 seems to support the position of amicus curiae. The clause "beyond that required by existing law," it is argued modifies the term "level," not "activity or service." This suggests that the Headlee Amendment would apply whenever the state increased the level of any activity, whether optional or required, above the level required at the time of the amendment's enactment.

While amicus curiae makes a plausible argument[430 Mich. 643] from a grammatical standpoint, we must examine the language of a constitutional provision not only in a strictly grammatical context but also in light of the general purpose for which the provision was adopted.

"The primary and fundamental rule of constitutional or statutory construction is that the Court's duty is to ascertain the purpose and...