Webster Realty Co. v. City of Fort Dodge

Decision Date10 February 1970
Docket NumberNo. 53872,53872
Citation174 N.W.2d 413
PartiesWEBSTER REALTY COMPANY. Appellant. v. CITY OF FORT DODGE, Iowa, Appellee.
CourtIowa Supreme Court

Bastian, Beisser & Carlson, Fort Dodge, for appellant.

Donald J. Mitchell, Fort Dodge, and Herrick, Langdon, Belin & Harris, Des Moines, for appellee.

LeGRAND, Justice.

This is a declaratory judgment action brought by plaintiff, an Iowa corporation with its principal place of business in Fort Dodge, to test the validity of proceedings under which the City of Fort Dodge proposes to issue $500,000.00 in general obligation urban renewal bonds as authorized by chapter 403, Code of Iowa, 1966. The suit was brought in equity, and our review is de novo.

Chapter 403 was enacted in 1957 and is popularly known as the Urban Renewal Law. Under its provisions municipalities are given broad powers to 'eliminate slums and prevent the development or spread of slums and urban blight and to encourage needed urban rehabilitation.' Section 403.3, Code of Iowa.

The facts are not in dispute. Acting pursuant to chapter 403, the City Plan Commission of Fort Dodge approved an urban renewal plan described in the record as the Riverfront Project. We shall so refer to it here. The plan was then presented to the city council. Thereafter the city council set a time and place for public hearing, which was held on November 26, 1968, and which was attended and participated in both by those who supported and those who opposed the plan.

Following the public hearing, the city council adopted a resolution which included a finding that the area covered by the Riverfront Project is 'a blighted, decadent area, and qualifies as an eligible project area under chapter 403, Code of Iowa 1966.'

The total cost of the project is estimated at $2,000,000.00. The Department of Housing and Urban Development of the Federal government tentatively committed itself to furnish three fourths of this amount. The city proposes to issue its general obligation bonds in the amount of $500,000.00 to provide the balance of the required amount.

On January 9, 1969, the city council passed a resolution fixing January 28, 1969, as the time for a meeting at which proceedings would be instituted for the issuance of these bonds under section 403.12(5), Code of Iowa. Prior to the date fixed for that meeting, a petition was filed by the required number of electors asking that the city submit the issuance of these bonds to the legal voters at a special election as provided in chapter 408A, Code of Iowa. The election was held and the proposal passed by more than the necessary 60 percent of all those casting votes.

The city council then passed a resolution providing for the issuance of $500,000.00 general obligation urban renewal bonds. The resolution, among other things, ordered that there be levied on all taxable property within the city a direct annual tax for each of the years while said bonds or any of them are outstanding, in amounts sufficient to pay the principal and interest thereon.

It is the issuance of these bonds which plaintiff seeks to prevent. Plaintiff prays for a decree holding that 'the statute and laws under which the city council purported to act, are unconstitutional, illegal and void, and that any general obligation urban renewal bonds issued * * * pursuant to the acts of the city council would be illegal and void, and further prays for a permanent injunction restraining the defendnat from issuing and selling its $500,000.00 general obligation urban renewal bonds.' The trial court found against plaintiff and held the bonds to be issued pursuant to the proceedings in question would be valid general obligation bonds of the City of Fort Dodge. Plaintiff appeals and we affirm.

Plaintiff urges numerous grounds for reversal. Some attack the constitutionality of chapter 403, both generally and as to particular sections; others challenge the propriety and sufficiency of the manner in which the city attempted to carry out the authority granted under chapter 403.

We have considered all of the objections urged by plaintiff, although we do not discuss each in detail. Neither do we treat them in the same order as listed by plaintiff in its brief and argument. We find nothing in any of the propositions which would warrant a reversal.

I. Plaintiff argues chapter 403 is unconstitutional because (1) it grants certain citizens privileges or immunities not granted equally to all in violation of Article I, section 6, Constitution of Iowa; (2) it deprives plaintiff of its property without due process of law and without equal or proportionate participation in the benefits of tax expenditures in violation of Article I, section 9, Constitution of Iowa; and, (3) it appropriates funds and levies taxes for private purposes in violation of Article III, section 31, Constitution of Iowa.

None of these complaints against urban renewal laws is new. However, such legislation has been almost universally upheld against these attacks. See annotation in 44 A.L.R.2d, page 1414, for compilation of cases dealing with this subject.

Basic to these objections is the argument that urban renewal serves no legitimate public purpose, and that it serves only the interest of the few who live within the project area at the expense of the many who must pay taxes to finance any rehabilitative effort. This argument was long ago discredited, and the question is no longer an open one. 40 Am.Jur.2d, Housing Laws and Urban Redevelopment sections 1, 2, and 3, pages 1060--1063; R & R Welding Supply Company v. City of Des Moines, 256 Iowa 973, 977, 129 N.W.2d 666, 669; Annotations, 44 A.L.R.2d 1414, 1420.

Nor does the fact that one class may benefit incidentally more than another destroy the public character of urban renewal or make it vulnerable to the attack that it is a special privilege law. Any legislation which provides for public improvement benefits some to a greater degree than others. We have several times held this raises no constitutional barriers.

In Dickinson v. Porter, 240 Iowa 393, 416, 35 N.W.2d 66, 80, we said, 'A law may serve the public interest although it benefits certain individuals or classes more than others. (citations)' See also Graham v. Worthington, 259 Iowa 845, 858, 146 N.W.2d 626, 635, and citations.

We must also disagree with plaintiff that it is deprived of its property without due process of law simply because it claims to receive no direct benefit from this urban renewal project. Graham v. Worthington, supra, 259 Iowa at page 864--865, 146 N.W.2d at page 639.

We find no merit in the propositions urged in this division.

II. Plaintiff next claims chapter 403 is so vague and indefinite as to render it unconstitutional and impossible of enforcement. It particularly levels that charge at section 403.12.

The principal claim concerns subsection five of section 403.12, which authorizes the issuance of general obligation bonds. Plaintiff argues that when considered along with section 403.9 authorizing the issuance of revenue bonds it is impossible to ascertain the real legislative intent. We find no conflict between these two sections, nor in any other provision of the chapter. It seems apparent the legislature intended to permit urban renewal to be financed either by revenue bonds, by general obligation bonds, or by a combination of both. Section 403.12(5) specifically authorizes the issuance of general obligation bonds 'in addition to any authority to issue bonds pursuant to section 403.9.'

One who claims the invalidity of a statute because it is vague and indefinite must make a clear showing to that effect and must show the courts cannot determine the legislative intent with a reasonable degree of certainty by accepted rules of construction. Plaintiff has utterly failed to do this. Graham v. Worthington, 259 Iowa 845, 851, 146 N.W.2d 626, 631; Lee Enterprises, Inc. v. Iowa State Tax Commission, Iowa, 162 N.W.2d 730, 738, 739, and citations.

III. Plaintiff also asserts the urban renewal law is unconstitutional because it delegates legislative authority to the municipality in contravention of Article III, section 1, Constitution of Iowa. Plaintiff singles out section 403.14 as being particularly vulnerable to this charge.

Although we have met this problem as presented and argued by plaintiff, we point out our recent decision in Koelling v. Board of Trustees, 259 Iowa 1185, 1190--1193, 146 N.W.2d 284, 287--289, supports the general rule that delegation of legislative power to municipal corporations to govern matters which are Local in scope is not within the constitutional prohibition. But in any event we find no such delegation of authority as offends against Article III, section 1, of our Constitution. See Graham v. Worthington, supra, 259 Iowa at page 857, 146 N.W.2d at 634; State v. Rivera, 260 Iowa 320, 323, 149 N.W.2d 127, 131; Elk Run Telephone Company v. General Telephone Company, Iowa, 160 N.W.2d 311, 315. Here the legislature has given municipalities broad powers to effect the purposes of the urban renewal law, but it has also carefully spelled out the general policy under which that is to be done. The city is required to adopt a program and the legislature has specified what that may include (section 403.3). The powers which the municipality may exercise are itemized at section 403.6. A detailed program for the issuance of bonds is set out at section 403.9. Additional provisions describing generally the extent to which the city may exercise its authority are catalogued at sections 403.8, 403.12, 403.14 and 403.15.

We agree with the many jurisdictions which, under similar circumstances, have held such delegation of authority to be unobjectionable. See Re-development Commission of Greensboro v. Security National Bank, 252 N.C. 595, 114 S.E.2d 688, 698; Wilson v. City of Long Branch, 27 N.J. 360, 142 A.2d 837, 847; Alanel Corp. v. Indianapolis Redevelopment Commission, 239 Ind. 35, 154 N.E.2d 515, 520; ...

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