Snyder v. City of Cheyenne

• Decision Date: 03 February 1959
• Docket Number: No. 2896,2896
• Citation: 79 Wyo. 405,334 P.2d 750
• Parties: Arthur SNYDER, Mrs. William McIvor, Mrs. August Johnson, Neal Hoffman and Morris Wax, et al., Appellants (Petitioners below), v. CITY OF CHEYENNE, a Municipal Corporation; Worth Story, as Mayor of said City; Herbert Kingham and Walter (Buzz) Bradley, as City Commissioners of said City of Cheyenne, Wyoming; and Vivian F. Rodin, as City Clerk of said City, Appellees (Respondents below).
• Court: Wyoming Supreme Court

Page 750

334 P.2d 750

79 Wyo. 405

Arthur SNYDER, Mrs. William McIvor, Mrs. August Johnson, Neal Hoffman and Morris Wax, et al., Appellants (Petitioners below), v. CITY OF CHEYENNE, a Municipal Corporation; Worth Story, as Mayor of said City; Herbert Kingham and Walter (Buzz) Bradley, as City Commissioners of said City of Cheyenne, Wyoming; and Vivian F. Rodin, as City Clerk of said City, Appellees (Respondents below).

No. 2896.

Supreme Court of Wyoming.

Feb. 3, 1959.

Carroll & Cole, Charles E. Lane, Cheyenne, for appellants.

Philip White and A. G. McClintock, Cheyenne, for appellees.

Before BLUME, C. J., and PARKER and HARNSBERGER, JJ.

Mr. Chief Justice BLUME delivered the opinion of the court.

This is an action brought by citizens and taxpayers of Cheyenne, Wyoming, to test the validity of an ordinance of the City of Cheyenne adopted June 9, 1958, under which and pursuant to a vote of the people the city proposes to issue revenue bonds in the amount of $250,000 for the purpose of extending the sewerage system of the city in the north and east part thereof. The trial court declared the ordinance valid and plaintiffs have appealed to this court from the decision of that court.

To understand the situation herein fully, it should be mentioned that the City of Cheyenne on March 14, 1949, adopted Ordinance 857 to issue revenue bonds for a sewage disposal system in the amount of $1,100,000. The electors of the city approved. The bonds were actually issued pursuant to Ordinance 927 adopted November 20, 1950, and are actually outstanding at this time except that already bonds in the sum of $360,000 have been redeemed. Thereafter the City of Cheyenne levied service charges for the use of the presently existing sewerage system to be used for the payment of the cost of construction of the sewage disposal plant and cost of operating and maintaining it.

According to the prospectus in the record before us, the purpose of the bond issue of $250,000 above mentioned is to provide the people of Cheyenne with an intercepter or trunk sewer line to collect sewage from lateral sewer lines and deliver it to the present sewage disposal or treatment plant located on the bank of Crow Creek east of the city limits of Cheyenne. The proposed present sewer line is expected to collect sewage from some nine additions to the City of Cheyenne in which there are about 300 homes or about 1,000 people, these homes having no sewer system other than septic tanks. In addition thereto, the trunk or intercepter line is expected to serve a total area of about 4,500 acres on which there are about 700 dwelling units. Plans and specifications were prepared by the City Engineer of the City of Cheyenne and were on file in the city offices from and after December 1, 1957, and have been continuously open for inspection since that time.

On June 9, 1958, the Council of the City of Cheyenne adopted Ordinance 1220 which provides in part as follows:

'Entitled: An Ordinance Providing For The Submission To A Vote Of The People Of The City Of Cheyenne, Wyoming, The Question Of Issuing Bonds Of The City Payable Solely Out Of The Revenues To Be Derived From The Operation Of The Sewerage System Of Said City, For The Purpose Of Extending Said Sewerage System, And Declaring An Emergency.

'Whereas, the City Council of the City of Cheyenne, Wyoming, deems it necessary and advisable to extend the sewerage system of said City and, subject to a vote of the people of said City, to issue bonds payable solely out of the revenues to be derived from the operation of the sewerage system of said City, as extended, as provided by the Laws of Wyoming and particularly Chapter 29, Article 27, Wyoming Compiled Statutes, 1945, as amended; and

'Whereas, plans and specifications for such project have been adopted and are on file in the office of the Clerk of said City where the same may be inspected by the public; and

'Whereas, the estimated cost of constructing such project and paying the costs and expenses incident thereto is $330,000.00, of which sum approximately $80,000.00 will be paid by the Federal Government; and

'Whereas, the City Council has determined that the period of usefulness of said project is at least forty years; and

'Whereas, the amount of revenue bonds proposed to be issued is $250,000, consisting of 250 bonds in the denomination of $1,000 each, bearing interest at a rate or rates not exceeding 4% per annum, payable semi-annually, such bonds maturing as follows:

Amount & Maturity

$10,000 1960 to 1964, incl.

15,000 1965 and 1966

10,000 1967 to 1974, incl.

45,000 1975 and 1976

Said bonds shall be redeemable at the option of the City in such amounts and at such time, with or without premium, as shall later be determined by Ordinance; and

'Whereas, said bonds shall be paid, principal and interest, solely out of the revenues to be derived from operating the sewerage system of said City, as extended, which revenues are hereby pledged for the purpose of paying the cost of operating and maintaining said extended system, providing an adequate depreciation fund and paying the principal of and interest on such revenue bonds; and

'Whereas, it is proposed that the City shall charge and collect from the users of said sewerage system as extended, service rates which shall be sufficient to make the payments in the last preceding paragraph specified; and

'Whereas, if the people of said City approve the issuance of said bonds, the City Council will adopt a supplemental ordinance containing such provisions as are required or permitted by the law under which such bonds shall be issued.'

The ordinance provided for a special election to be held on Tuesday, July 8, 1958. The election was properly held and was approved by the qualified electors of the city by a vote of 2,580 in favor of the proposition as against 1,144 electors against it. And thereupon the mayor and council of the city proposed to issue the bonds so authorized by the electors. To prevent that, the present action was commenced.

It is freely admitted by counsel for the appellants herein that the City of Cheyenne has the right to issue revenue bonds as proposed at the present time in order to extend its sewerage system. The right to issue such bonds was fully discussed and upheld in the case of Laverents v. City of Cheyenne, 67 Wyo. 187, 217 P.2d 877. Counsel for appellants assail the validity of the ordinance here in question only on certain and specific grounds which we shall proceed to discuss.

1. Counsel for appellants contend that the ordinance is invalid because it did not specifically state that the amount of money to be derived from the bonds should be devoted to the proposed extension of the sewerage system and that, accordingly, the city could divert the money derived from the sale of the bonds to a different object. We can see no merit in that contention. The ordinance states that the bonds are to be issued for the purpose of extending the...