Sullivan v. Town of Hampton Bd. of Selectmen

• Citation: 917 A.2d 188,153 N.H. 690
• Decision Date: 27 June 2006
• Docket Number: No. 2005–464.,2005–464.
• Court: Supreme Court of New Hampshire
• Parties: William H. SULLIVAN and another. v. TOWN OF HAMPTON BOARD OF SELECTMEN.

153 N.H. 690

917 A.2d 188

William H. SULLIVAN and another.

v.TOWN OF HAMPTON BOARD OF SELECTMEN.

No. 2005–464.

Supreme Court of New Hampshire.

Argued: May 11, 2006.

Opinion Issued: June 27, 2006.

Cook & Molan, P.A., of Concord (Richard E. Molan on the brief, and John S. Krupski orally), for the plaintiffs.

Mark S. Gearreald, of Hampton, on the brief and orally, for the defendant.

C. Christine Fillmore, of Concord, by brief, for the New Hampshire Local Government Center, as amicus curiae.

HICKS, J.

The plaintiffs, William H. Sullivan, Edward Buck and Thomas Gillick, are three taxpayers (taxpayers) who appeal the order of the Superior Court (McHugh, J.) granting defendant Town of Hampton Board of Selectmen's (selectmen) motion to dismiss for failure to state a claim upon which relief may be granted. We affirm.

The record supports the following facts. The Town of Hampton is a Senate Bill 2 (SB 2) jurisdiction, meaning that it has adopted the official balloting procedures for the town meeting form of government in RSA 40:13 (Supp.2005). RSA 40:13 prescribes balloting procedures on all warrant issues put to voters, including annual town budgets. An SB 2 town budget committee develops an "operating budget" that the selectmen submit to voters for approval. When submitted to voters, the ballot reflects only a single bottom line sum of the entire "operating budget." If adopted by voters, that "operating budget" represents the town's annual appropriated line item expenditures.

The legislature amended RSA 40:13 in 2004 to provide for a "default budget" if voters fail to adopt the proposed "operating budget." The "default budget" is calculated as the prior year's budget, adjusted up or down by other obligations and reduced by one-time expenditures. If voters fail to adopt the proposed "operating budget," they are either deemed to have approved the "default budget," or the governing body may choose to have a special town meeting to plan and submit a "revised operating budget" to voters.

The 2004 amendment to RSA 40:13 also included new procedures for public disclosure of the line item appropriations within a "default budget," presumably to enhance the transparency of the "default budget" calculation. At the first budget meeting, prior to presenting the budget committee's "operating budget" for approval, the selectmen must disclose on a special form the "default budget" amount and how it was calculated.

RSA 32:10, I (Supp.2005) gives the selectmen discretionary authority to transfer funds within a previously adopted budget as unplanned needs arise. The issue presented for review is whether RSA 40:13, as amended in 2004, limits the selectmen's authority pursuant to RSA 32:10 to transfer line item appropriations within a "default budget."

In March 2005, the Town of Hampton presented its municipal "operating budget" of $26,392,546 to its voters alongside the "default budget" of $23,552,795. The voters failed to adopt the "operating budget," and the selectmen chose to implement the "default budget."

The selectmen then solicited proposals from each town department for a 15% reduction in their individual budgets to offset the approximate 15% ($2.8 million) shortfall in the town's anticipated operating budget. The selectmen subsequently held four weekly public meetings during which they altered appropriations for the 2005 budget year. This resulted in a 2005 budget that did not exceed the bottom line default budget total in the previously disclosed "default budget," but deviated from the prior year's individual appropriations in twenty-nine of the thirty-four line items.

The taxpayers filed a petition for injunctive relief, writ of mandamus and other relief on April 22, 2005, in the superior court. The selectmen moved to dismiss. A temporary hearing was held by offers of proof on May 5, 2005. The superior court granted the selectmen's motion to dismiss.

On appeal, the taxpayers argue that the trial court erred in finding that RSA 32:10 provides the town selectmen "unfettered" discretionary authority to change line item appropriations within the "default budget." Further, the taxpayers argue that even if the selectmen did properly exercise their discretionary authority to make line item changes within the budget, the selectmen failed to follow the prescribed statutory procedures for implementing the budget because the altered budget constituted a "revised operating budget" within the meaning of RSA 40:13, X, requiring notice to and approval by voters. Both are questions of first impression.

We first address whether to dismiss this case as moot. The taxpayers challenge the implementation of Hampton's 2005 budget. The underlying dispute is substantially moot because Hampton is now well into the 2006 budgetary year. The doctrine of mootness is designed to avoid deciding issues that "have become academic or dead." Petition of Brooks, 140 N.H. 813, 816, 678 A.2d 140 (1996). However, the question of mootness is not subject to rigid rules, but is regarded as one of convenience and discretion. Herron v. Northwood, 111 N.H. 324, 327, 282 A.2d 661 (1971). A decision upon the merits may be justified where there is a pressing public interest involved, or future litigation may be avoided. Id. We find sufficient public interest in the outcome of this controversy to justify an exception to the doctrine of mootness. Id.

Because the interpretation of a statute is a question of law, we review the trial court's ruling de novo. Starr v. Governor, 151 N.H. 608, 610, 864 A.2d 348 (2004). When interpreting a statute, we consider the language of the statute itself, and if possible, construe the language according to its plain and ordinary meaning. Id.

The taxpayers do not argue that the selectmen lacked the statutory authority to make adjustments to a "default budget." Rather, they argue that the selectmen improperly exercised this authority by immediately adjusting the "default budget" in response to the voters' failure to adopt the "operating budget." In support of their position, they point to language in RSA 32:10, I, that states:

If changes arise during the year following the annual meeting that make it necessary to expend more than the amount appropriated for a specific purpose, the governing body may transfer to that appropriation an unexpended balance remaining in some other appropriation.

The taxpayers further argue that no evidence was presented that records were kept, as required by RSA 32:10, I(b), which would allow "any citizen requesting such records pursuant to RSA 91–A:4 ... [to] ascertain the purposes of appropriations to which, and from which, amounts have been transferred." RSA 32:10, I(b).

Finally, the taxpayers urge that the 2004 amendment to RSA 40:13 requiring prior disclosure of the default budget calculation is meaningless if the selectmen have "unfettered" authority to alter the individual line items immediately after the "default budget" is implemented.

The selectmen respond by arguing that the failure to adopt the "operating budget" was a change in circumstances sufficient to merit changing the default appropriated amounts. They argue that transferring...