Shelby Charter Tp. v. State Boundary Com'n

• Decision Date: 20 May 1986
• Docket Number: 73333,Docket Nos. 72897
• Citation: 425 Mich. 50,387 N.W.2d 792
• Parties: SHELBY CHARTER TOWNSHIP, a Michigan municipal corporation, Petitioner-Appellee, v. Michigan STATE BOUNDARY COMMISSION a state agency, David R. Calhoun, James F. Smith, Peter M. Lamberts, John Ruggero and Edward Knight, jointly and severally, Respondents-Appellants, and City of Utica, a municipal corporation, Intervening Respondent-Appellee. 425 Mich. 50, 387 N.W.2d 792
• Court: Michigan Supreme Court

Page 792

387 N.W.2d 792

SHELBY CHARTER TOWNSHIP, a Michigan municipal corporation Petitioner-Appellee, v. Michigan STATE BOUNDARY COMMISSION a state agency, David R Calhoun, James F. Smith, Peter M. Lamberts, John Ruggero and Edward Knight, jointly and severally Respondents-Appellants and City of Utica, a municipal corporation, Intervening Respondent-Appellee.

Docket Nos. 72897, 73333.

425 Mich. 50, 387 N.W.2d 792

Supreme Court of Michigan.

Argued Nov. 12, 1985.

Decided May 20, 1986.

Richard C. Johnston, Mount Clemens, for petitioner-appellee, Charter Tp. of Shelby.

William J. McGrail, Jr., Utica City Atty., Utica, for intervening respondent-appellant, the City of Utica.

Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., Milton I. Firestone, Asst. Atty. Gen., Roderick T. MacGillis, Asst. Atty. Gen., Lansing, for respondents-appellants State Boundary Com'n, et al.

BOYLE, Justice.

The question before this Court is whether the State Boundary Commission exceeded its statutory authority when it determined that appellee, the Charter Township of Shelby was not exempt from annexation under M.C.L. Sec. 42.34(1); M.S.A. Sec. 5.46(34)(1). The commission found that Shelby was not exempt on the basis that neither the amount of water services nor the amount of sewer services Shelby provided met the standard for exemption set forth in Sec. 34(1)(f). Shelby appealed the commission's order of annexation to the Macomb Circuit Court, which set the order aside as in excess of the commission's statutory authority pursuant to Sec. 106(1)(b) of the Administrative Procedures Act, M.C.L. Sec. 24.306(1)(b); M.S.A. Sec. 3.560(206)(1)(b). ¹ The court held that M.C.L. Sec. 42.34(1)(f); M.S.A. Sec. 5.46(34)(1)(f) plainly and unambiguously exempts a charter township which provides any water or sewer services from annexation, and that the commission had therefore exceeded its statutory authority in finding the amount of water and sewer services provided by Shelby to be insufficient for exemption from annexation. The Court of Appeals, with some qualification, affirmed, 129 Mich.App. 650; 341 N.W.2d 855 (1983). We granted leave to appeal, 422 Mich. 857 (1985), and now reverse.

Facts

On December 14, 1977, the City of Utica filed a petition with the State Boundary Commission to annex one-half square mile of Shelby territory. M.C.L. Sec. 117.9; M.S.A. Sec. 5.2088. While the petition was pending before the commission, 1978 P.A. 242 and 1978 P.A. 591, amending M.C.L. Sec. 42.34; M.S.A. Sec. 5.46(34), were enacted, and Shelby began the process of incorporation, becoming a charter township on November 30, 1978. As amended by 1978 P.A. 591, Sec. 34(1) provided:

"Sec. 434. (1) A charter township existing on June 15, 1978, or a township incorporated after June 15, 1978 as a charter township that complies with the following standards, is exempt from annexation to any contiguous city or village except as provided in subsections (2) to (8):

"(a) Has a state equalized valuation of not less than $25,000,000.00.

"(b) Has a minimum population density of 150 persons per square mile to be determined by the secretary of state by dividing the most recent regular or special census of population by the number of square miles then under the jurisdiction of the charter township not to include the population or territory within the jurisdiction of an incorporated village.

"(c) Provides fire protection service by contract or otherwise.

"(d) Is governed by a comprehensive zoning ordinance or master plan.

"(e) Provides solid waste disposal services to township residents, within or without the township, by contract, license, or municipal ownership.

"(f) Provides water or sewer services, or both, by contract or otherwise.

"(g) Provides police protection through contract with the sheriff in addition to normal sheriff patrol or through its own police department."

Nevertheless, at an adjudicative meeting held May 2, 1979, the commission held that Shelby was not exempt from annexation because it did not meet the standards of Sec. 34(1)(f).

The evidence presented to the commission pursuant to Utica's 1977 petition indicates that Shelby's population consisted of approximately 40,000 residents in approximately 11,000 households, and that Shelby's land area consisted of approximately 35.6 square miles. According to the commission's undisputed findings with respect to the standards set forth in M.C.L. Sec. 42.34(1); M.S.A. Sec. 5.46(34)(1), Shelby (a) had a 1977 state equalized valuation of $262,736,360, (b) had a population density of approximately 1000 people per square mile, (c) had a full time, forty-member fire department, (d) had a comprehensive zoning ordinance and master plan, (e) provided solid waste disposal services, and (g) had a full time, forty-nine-member police department. In these respects the commission found that Shelby met the statutory standards for exemption from annexation. According to the evidence before the commission, however, Shelby provided sewer services to only 1200 residents in 500 homes on six percent of the township's territory, and provided water services to less than one-third of the population, that is, to 12,000 residents in 4000 homes. ² The commission found that neither the amount of sewer services, nor the amount of water services, provided by Shelby met the standard set forth in Sec. 34(1)(f), "[p]rovides water or sewer services, or both, by contract or otherwise." The commission consequently held that Shelby was not exempt from annexation under Sec. 34(1).

After further proceedings not relevant here, the commission granted Utica's petition at the May 1979 adjudicative meeting. On December 11, 1980, the commission entered its final order of annexation. After initially staying the order, the Macomb Circuit Court reversed. The circuit court held that Sec. 34(1)(f) unambiguously requires no more than the provision of any water or sewer service and was therefore not subject to interpretation by the commission. Since Shelby provided some water and sewer services, the circuit court held that "the State Boundary Commission decision is in direct violation of M.C.L. Sec. 42.34 and ... is in excess of the statutory authority and jurisdiction of the agency." The Court of Appeals affirmed with the qualification that "[a] township that only provided token services would not be exempt under this statute since courts will depart from a literal construction of a statute when such a construction would produce absurd and unjust results." 129 Mich.App. at 656, 341 N.W.2d 855.

Background

The boundaries of a unit of local government affect the tax base of the unit, the tax rate of its residents, the level of services provided to residents, and the potential for further development of the unit. Issues regarding annexations of part of a local unit to another therefore tend to be politically volatile. In accordance with long-established law in this state, ³ and with federal constitutional law, ⁴ this Court has recently held:

"The annexation question is essentially political, and political considerations cannot be avoided whether the power is exercised by the Legislature itself or by an authority to which the power is delegated. The ultimate decision will be a value judgment based on the particular facts and circumstances of the annexation under consideration.... In this context it is ... relevant that the power here delegated does not involve any vested right or legally protected interest.

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"[N]o governmental authority or person has any legal right in the boundaries of a city, village or township." Midland Twp. v. Boundary Comm., 401 Mich. 641, 669, 670-671, 259 N.W.2d 326 (1977).

Prior to 1970, all annexations had to be approved by the electors of the affected district, which was defined as "the whole of each city, village, or township from which territory is to be taken or to which territory is to be annexed," M.C.L. Secs. 78.5, 117.9; M.S.A. Secs. 5.1515, 5.2088. A majority vote in favor of the annexation was required, first, in the area to be annexed, and, second, in the remainder of the affected district "voting collectively." Id. These referenda elections frequently generated a great deal of divisiveness and litigation. See, e.g., Goethal v. Kent Co. Supervisors, 361 Mich. 104, 104 N.W.2d 794 (1960); Genesee Twp. v. Genesee Co., 369 Mich. 592, 120 N.W.2d 759 (1963); Taylor v. Dearborn Twp., 370 Mich. 47, 120 N.W.2d 737 (1963); Saginaw v. Saginaw Co. Bd. of Supervisors, 1 Mich.App. 65, 134 N.W.2d 378 (1965); Niles Twp. v. Berrien Co, 5 Mich.App. 240, 146 N.W.2d 105 (1966).

The State Boundary Commission was created by 1968 P.A. 191, M.C.L. Sec. 123.1001 et seq.; M.S.A. Sec. 5.2242(1) et seq. In 1970, the Legislature delegated the authority over annexations to the commission. 1970 P.A. 219; see also 1972 P.A. 362. The background of 1970 P.A. 219 was, in 1977, described as follows:

"I have been in the House for 13 years and I remember the emotional battles in the Legislature on annexation bills almost every year up to 1970.

"Shortly before I started my first term in the House in 1965, a special annexation study committee, which had been appointed previously by Governor Swainson, submitted its report to Governor Romney. The basic recommendation in the report was to create a State Boundary Commission which would take the question of municipal boundary adjustments out of the arena of emotions (referenda elections) and put the question in the hands of an impartial body which would include both state and local representation and which would make decisions on the basis of facts rather than emotions.

"I remember clearly the additional years of legislative battles before the State Boundary Commission was created in 1968. Even then, in order to get enough votes to create the Commission, the Legislature compromised by dropping from the bill the provisions relating to annexation.

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"The annexation law before 1...