State v. Holcomb

• Decision Date: 10 June 1911
• Docket Number: 17,294
• Citation: 116 P. 251,85 Kan. 178
• Parties: THE STATE OF KANSAS, ex rel. Joseph Taggart, as County Attorney, etc., et al., Plaintiffs, v. F. M. HOLCOMB, as County Clerk, etc., Defendant, (THE CITY OF KANSAS CITY, MISSOURI, Interpleader)
• Court: Kansas Supreme Court

116 P. 251

85 Kan. 178

THE STATE OF KANSAS, ex rel. Joseph Taggart, as County Attorney, etc., et al., Plaintiffs, v. F. M. HOLCOMB, as County Clerk, etc., Defendant,

(THE CITY OF KANSAS CITY, MISSOURI, Interpleader)

No. 17,294

Supreme Court of Kansas

June 10, 1911

Decided January, 1911.

Original proceeding in mandamus.

SYLLABUS

SYLLABUS BY THE COURT.

1. TAXATION--Property in Kansas belonging to Missouri Municipality. A water plant owned by a municipality of Missouri and located in Kansas is subject to taxation under the laws of Kansas.

2. TAXATION--Exemption -- Municipal Property -- Local -- Foreign. The exemption from taxation of the property of the state and any of its municipalities, provided for in the constitution and statutes, refers to the municipalities of Kansas and not to those of another state.

3. TAXATION--Property of Foreign State or Municipality Subject to Taxation Same as Private Owner. When a state or any of its municipalities, goes into another state and there acquires and uses property it does not carry with it any of the attributes of sovereignty nor exercise of governmental power. It has no other or greater right there than any other private owner of property and its property is subject to the taxation which the laws of that state impose.

Joseph Taggart, county attorney, and Keplinger & Trickett, for the plaintiffs.

John G. Park, Inghram D. Hook, and A. L. Berger, for the interpleader.

OPINION

JOHNSTON, C. J.:

This is an action to compel F. M. Holcomb, as county clerk, to extend upon the tax rolls of the county for taxation a waterworks plant owned by the municipality of Kansas City, Mo., which is situated in Wyandotte county, Kansas. The county clerk declined to place the property on the tax rolls because of a claim that it was exempt from taxation. The municipality of Kansas City, Mo., intervened and alleged that it had charter authority to own and operate waterworks, to supply the city and inhabitants with water, either inside or outside of its corporate limits, and that its water plant, a part of which is located in Kansas, had been acquired by the city under a decree of the federal court adjudging that the then owner should sell and the city should purchase on terms fixed by the court; that the property proposed to be taxed is worth more than $ 200,000 and that the tax proposed to be levied on the property would amount to $ 16,000 or more per year, and that as the property is owned exclusively by the municipality and used and operated exclusively for public purposes it is, and should be held, exempt from taxation. There are allegations, also, that to extend the property on the tax rolls would conflict with the state constitution, and also with the provision of the federal constitution prohibiting a state from depriving any person of life, liberty, or property without due process of law or from denying to any person within its jurisdiction the equal protection of the law. Among other things it is alleged that the two cities lie close together, being divided only by the state line running through the center of a public street, and that the water plants of both are contiguous and arranged so that connections can be readily made and so that there may be cooperation between the fire departments of the two cities, and that, in times past, each has rendered assistance to the other to the mutual advantage and benefit of both. The state challenges the sufficiency of the answer of the interpleader and the case is submitted here on its demurrer.

The principal and controlling question arising on the pleadings is: Should the water plant be entered on the tax rolls, or is it exempt from taxation the same as like property of Kansas municipalities? The state of Kansas does not tax its own property nor that of any of its municipalities. They are expressly exempted by section 1 of article 11 of the constitution, which ordains that:

"The legislature shall provide for a uniform and equal rate of assessment and taxation; but all property used exclusively for state, county, municipal, literary, educational, scientific, religious, benevolent and charitable purposes, and personal property to the amount of at least two hundred dollars for each family, shall be exempted from taxation."

From the organization of the state until the present time it has been provided by statute that property of this state and of the United States shall be exempt from taxation, as well as property of any county, city, town or school district. (Gen. Stat. 1868, ch. 107, § 3; Laws 1907, ch. 408, § 2, Gen. Stat. 1909, § 9216.) It is inconsistent with our theory of government for a sovereign state to tax itself or any of its instrumentalities in order to raise money for itself. It would amount to no more than taking money from one pocket and putting it into another. It has been held that a general provision that all property within the state shall be taxed necessarily implies an exception of the property of the state enacting the law and that of its agencies and instrumentalities, such as counties, cities, towns, and school districts. In section 773 of volume 2 of the fourth edition of Dillon's Municipal Corporations, it is said:

"The general statutes of the state upon the subject of taxing property undoubtedly refer to private property, and not to that owned by the state; and, in view of the public nature of municipalities, and the purposes for which they are established, heretofore explained, the author is of opinion that such enactments do not, by implication, extend to any property owned by them--certainly to none owned by them for public uses."

Of like import are the following authorities: People v. Doe G. 1,034, 36 Cal. 220; Directors of Poor v. School Directors, 42 Pa. 21; Camden v. Village Corporation, 77 Me. 530, 1 A. 689; 12 A. & E. Encycl. of L. 568.

There is, as we have seen, an express exemption of both federal and state property in Kansas, but it is claimed by the interpleader that this exemption applies to property of another state or, rather, to a municipality of the state of Missouri. A state is sovereign only within its own boundaries and its laws have no extraterritorial force. In making their constitution the people of Kansas were providing for their own institutions, municipalities and agencies and not for those of another sovereignty. The legislature, in enacting laws relating to taxation and to exemption from taxation, must be deemed to have understood the extent of its power and to have had in mind our own state and the counties, cities, and school districts within the state for which it was empowered to legislate. (St. Edwards' College v. Tax Collector, 82 Tex. 1, 17 S.W. 512; The People v. Seamen's Friend Soc., 87 Ill. 246.) It is true that the constitutional provision relating to taxation (Const. art. 11, § 1) does provide that all property used exclusively for "municipal" purposes shall be exempt, but the fact that the provision does not expressly say that the constitution is made for Kansas is not a good basis for an inference that the framers were attempting to regulate and protect the municipalities of other states. It is hardly to be presumed that they were attempting to exercise power over the state of Missouri, or of its municipal corporations, and neither can it be presumed that the legislature undertook to transcend its constitutional powers by providing a scheme of taxation for Missouri when the tax law was enacted. In the article of the constitution where the exemption is made of property used for state, county and municipal purposes there is an exemption of personal property to the amount of at least $ 200 provided for each family and it does not expressly say that the exemption is intended for a family residing in Kansas, but it will hardly be contended that this exemption would apply to a family residing in another state that happened to own property in Kansas, and yet there is as good reason for holding that the provision applies to a Missouri family as that the earlier provision of the same section has reference to a Missouri municipality. In a subsequent section of the same article it is provided that the state shall not contract any debt until it is authorized by a vote of the electors, and, in another, a restriction is placed on the state in regard to borrowing money, while, in still another, the state is prohibited from carrying on any works of internal improvement. In none of these provisions is the name of the state given, but who would claim that any other state than Kansas was in mind or that these sections applied to any other state than our own? The provisions of both the constitution and the statutes, in relation to exemption from taxation, must be understood as referring to Kansas and to the counties, municipalities and families of Kansas over which it has power of visitation and control.

A reference is made to Sumner County v. Wellington, 66 Kan. 590, as holding that the constitution contains a sweeping clause which absolutely prohibits the taxation of municipal property, regardless of whether the municipality is foreign or domestic. That case involved the right to tax the waterworks plant of a city of the state and, in consonance with the provisions of the constitution and statutes, it was held to be exempt, and the language of the opinion should be read in the light of the question that was being treated. There was no occasion there to draw distinctions between municipalities of this and other states and...