STATE EX REL. WV v. ECONOMIC DEVELOPMENT

• Decision Date: 16 May 2003
• Docket Number: No. 31125.,31125.
• Citation: 580 S.E.2d 869,213 W.Va. 255
• Court: West Virginia Supreme Court
• Parties: STATE of West Virginia ex rel. WEST VIRGINIA CITIZENS ACTION GROUP, an Incorporated Association of State Citizens and Taxpayers, Petitioner Below, Appellant, v. WEST VIRGINIA ECONOMIC DEVELOPMENT GRANT COMMITTEE; City of Wheeling, A Municipal Corporation; and Century Equities—Wheeling Victorian Outlet Mall, Inc., A Private Corporation, Respondents Below, Appellees. Kanawha County Commission, Intervenor.

580 S.E.2d 869

213 W.Va. 255

STATE of West Virginia ex rel. WEST VIRGINIA CITIZENS ACTION GROUP, an Incorporated Association of State Citizens and Taxpayers, Petitioner Below, Appellant, v. WEST VIRGINIA ECONOMIC DEVELOPMENT GRANT COMMITTEE; City of Wheeling, A Municipal Corporation; and Century Equities—Wheeling Victorian Outlet Mall, Inc., A Private Corporation, Respondents Below, Appellees.

Kanawha County Commission, Intervenor.

No. 31125.

Supreme Court of Appeals of West Virginia.

Submitted March 11, 2003.

Decided May 16, 2003.

Larry L. Harless, Cottageville, for the Appellant.

Darrell V. McGraw, Jr., Attorney General, Katherine A. Schultz, Senior Deputy Attorney General, Stephen Stockton, Senior Assistant Attorney General, Jennifer Lea Stollings, Assistant Attorney General, Charleston, for the Appellees.

G. Nicholas Casey, Richard L. Gottlieb, Webster J. Arceneaux, III, Lewis Glasser Casey & Rollins, PLLC, Charleston, for the Intervenor, Kanawha County Commission.

Rosemary J. Humway-Warmuth, Joanna I. Tabit, Steptoe & Johnson, PLLC, Wheeling, for the City of Wheeling, Amicus Curiae.

Robert M. Bastress, Morgantown, for American Civil Liberties Union of West Virginia, Amicus Curiae.

Vincent Trivelli, Stuart Calwell, Law Offices of Stuart Calwell, PLLC, Charleston, for The Affiliated Construction Trades Foundation, Amicus Curiae.

Webster J. Arceneaux, III, Richard L. Gottlieb, Lewis, Glasser, Casey & Rollins, PLLC, for Marshall University Research Corporation; Our Jobs, Our Children, Our Future, Inc. d/b/a The Huntington Area Development Council; Tri-State Transit Authority and Metropolitan Huntington, LLC; Advantage Valley Partners, LLC; Putnam County Development Authority; and Putnam County Commission, Amicus Curiae. ALBRIGHT, Justice.

The West Virginia Citizen Action Group¹ (hereinafter referred to as "CAG") appeals from the January 21, 2003, order of the Circuit Court of Kanawha County upholding the constitutionality of portions of West Virginia Code § 29-22-18a(d)(3) (Supp.2002), specifically as it pertains to the manner in which the members of the Appellee West Virginia Economic Grant Committee² (hereinafter referred to as the "Grant Committee" or the "Committee") are appointed and the process by which the Grant Committee selects and approves grant applicants. The challenged legislation involves a mechanism previously approved by this Court³ in the context of school bonds whereby revenue bonds are issued, without a vote of the state's citizenry, and repaid from an account within the West Virginia Lottery Fund designated as the "state excess lottery revenue fund."⁴ While no such bonds have been issued due to the litigation at hand, the bonds contemplated by the subject legislation would be dedicated to a host of projects chosen by the Grant Committee for the express objective of "advanc[ing] the business prosperity of this state and the economic welfare of the citizens of this state."⁵

I. Statutory and Procedural Background

At the center of this dispute is the statutory method for selecting the membership of the Grant Committee. The nine-person committee is comprised of the following individuals:

the governor, or his or her designee, the secretary of the department of tax and revenue, the executive director of the West Virginia development office, three persons appointed by the governor from a list of five names submitted by the president of the West Virginia senate, and three persons appointed by the governor from a list of five names submitted to the governor by the speaker of the West Virginia house of delegates.

W.Va.Code § 29-22-18a(d)(3). The involvement of the Legislature in identifying the list of potential committee members has sparked weighty challenges to this statute based on concerns rooted in the separation of powers provision of our state constitution.⁶

Pursuant to this statutory authorization, such a Grant Committee was selected and at its first meeting, the committee adopted a draft procedural rule delineating the criteria for considering the various submitted grant applications. The four-part standard upon which the projects were to be evaluated was: (1) the ability of the project to leverage other sources of financing; (2) job creation and retention; (3) promotion of economic development in the region; and (4) whether the project is in the public interest of the State. The enabling legislation provides that once the Grant Committee selects and certifies a list of projects, the list is not subject to alteration other than by legislative enactment. See W.Va.Code § 29-22-18a(d)(3).

During various meetings, the Grant Committee considered 197 submitted projects. Public hearings⁷ were held, as required by statute, in connection with the grant applications. See W.Va.Code § 29-22-18a(d)(3). While all 197 projects were reviewed during the period between April 25, 2002, and July 31, 2002, the Grant Committee approved the first grant recipient—the Wheeling Project⁸ —on May 8, 2002. The Grant Committee conditionally agreed to provide the Wheeling Project with seventy million dollars, provided that certain terms outlined in a May 13, 2002, award letter were met.⁹ An additional thirty-five projects were approved by the Grant Committee at two meetings held on October 17, 2002, and November 12, 2002.

CAG filed a petition with this Court on September 3, 2002, seeking writs of mandamus and prohibition in connection with the Wheeling Project's approval and other activities undertaken by the Grant Committee.¹⁰ This Court issued a rule returnable to the Circuit Court of Kanawha County to permit development of a record and to address the issues raised in an expeditious manner.¹¹ Following various hearings on this matter, the circuit court issued its memorandum order on January 21, 2003, through which the trial court ruled that the Grant Committee's singular consideration and approval of the Wheeling Project resulted in a flawed certification of that project for failure to meet an implied statutory requirement that multiple grant applications should be comparatively evaluated.¹² The circuit court found no constitutional infirmities with regard to the appointment process for the Grant Committee or the legislation authorizing the Committee's actions.

CAG appeals from the decision of the circuit court, seeking a ruling of unconstitutionality with regard to both West Virginia Code § 29-22-18a(d)(3) and the actions undertaken by the Grant Committee pursuant to such statutory authorization. The Appellant asserts error on various constitutional grounds, including separation of powers; improper delegation of legislative power; usurpation of the governor's appointment power; violation of the debt clause; and improper extension of the state's credit. Upon our review of the matter, we conclude that the appointment mechanism for the Grant Committee violates the separation of powers provision of the state constitution,¹³ and the appointments provision of the state constitution.¹⁴ Due to the insufficiency of the statutory guidance provided for the Grant Committee's use in selecting recipients for state funds, we determine that the Legislature has wrongfully delegated its powers in violation of the state constitution.¹⁵ With regard to the statutory challenges concerning alleged violations of the constitutional provisions governing debt and credit, and the statute's lack of a valid public purpose, we find no constitutional infirmities.

Although we have determined that West Virginia Code § 29-22-18a(d)(3) contains several constitutional deficiencies, we wish to make clear first, that we find no constitutional infirmities with regard to the overall legislative plan for seeking economic development with the aid of the Grant Committee. Second, and perhaps most importantly, we wish to point out that the Legislature, in our view, may easily correct the defects noted in this opinion and, further, that the necessary statutory amendments can be effected in a timely manner, should the Legislature decide to amend those limited provisions which we have determined to be constitutionally deficient. While we are mindful of the implementational delays with regard to previously approved projects, this Court's obligation to uphold the Constitution of this state compelled the result reached in this case.

II. Standard of Review

Our standard of review is de novo, given the questions of law raised that involve statutory application and the additional issues presented concerning the constitutionality of the enactment at issue. See Phillip Leon M. v. Greenbrier County Bd. of Educ., 199 W.Va. 400, 404, 484 S.E.2d 909, 913 (1996)

(stating that "[b]ecause interpretations of the West Virginia Constitution, along with interpretations of statutes and rules, are primarily questions of law, we apply a de novo review"); Syl. Pt. 1, Chrystal R.M. v. Charlie A.L., 194 W.Va. 138, 459 S.E.2d 415 (1995) ("Where the issue on an appeal from the circuit court is clearly a question of law or involving an interpretation of a statute, we apply a de novo standard of review."). Accordingly, our review of this matter is plenary.

III. Discussion

A. Separation of Powers

CAG, along with the American Civil Liberties Union of West Virginia (hereinafter referred to as the "ACLU"), as amicus curiae, strenuously assert that the appointment mechanism contained within the subject statute runs afoul of this state's separation of powers provision. That provision mandates that:

The legislative, executive and judicial departments shall be separate and distinct, so that neither shall exercise the powers properly belonging to either of the others; nor shall any person exercise the powers of more than one of them at the same time, except that justices of the peace shall be eligible to the legislature.

W.Va. Const. art. V, § 1. By creating the list from which the Grant Committee members are chosen, CAG argues that the Legislature, acting through its house...