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B-130749, MARCH 23, 1967, 46 COMP. GEN. 706

B-130749 Mar 23, 1967
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WHICH IS NOTED "TAXES DUE AND PAYABLE BEFORE FEBRUARY 1. THE MUNICIPALITY HOLDING THAT REAL PROPERTY TAXES ARE "DUE" IN JANUARY OF THE YEAR FOLLOWING THE TAX LEVY YEAR AND PROVIDING IN ITS CHARTER THAT TAXES AND ASSESSMENTS ON REAL ESTATE MUST BE PAID BETWEEN THE FIRST AND LAST DAYS OF JANUARY. THE 1966 REAL ESTATE TAXES ARE DUE IN JANUARY OF 1967. THE FACTS AND CIRCUMSTANCES GIVING RISE TO THE QUESTION PRESENTED ARE SET FORTH BELOW. THAT THE TAXES INVOLVED WERE LEVIED ON DECEMBER 19. YOUR DEPARTMENT ADVISED THE CITY TREASURER THAT THERE WAS NO AUTHORITY TO MAKE THE REQUESTED PAYMENT. SINCE IT WAS YOUR DEPARTMENT'S VIEW THAT THE TAXES DID NOT BECOME DUE PRIOR TO JANUARY 1. IS WHEN THE TAX ROLL IS DELIVERED TO THE LOCAL TREASURER WITH A WARRANT FOR COLLECTION.

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B-130749, MARCH 23, 1967, 46 COMP. GEN. 706

TAXES - STATE - PAYMENTS IN LIEU OF TAXES A BILL COVERING A PAYMENT IN LIEU OF TAXES FOR THE CALENDAR YEAR 1966, WHICH IS NOTED "TAXES DUE AND PAYABLE BEFORE FEBRUARY 1, 1967," MAY NOT BE PAID UNDER 40 U.S.C. 523, THE AUTHORITY TO MAKE PAYMENTS IN LIEU OF TAXES ON REAL PROPERTY TRANSFERRED FROM THE RECONSTRUCTION FINANCE CORPORATION TO ANY GOVERNMENT AGENCY DURING THE PERIOD ON OR AFTER JANUARY 1, 1955, AND PRIOR TO JANUARY 1, 1967. THE MUNICIPALITY HOLDING THAT REAL PROPERTY TAXES ARE "DUE" IN JANUARY OF THE YEAR FOLLOWING THE TAX LEVY YEAR AND PROVIDING IN ITS CHARTER THAT TAXES AND ASSESSMENTS ON REAL ESTATE MUST BE PAID BETWEEN THE FIRST AND LAST DAYS OF JANUARY, THE 1966 REAL ESTATE TAXES ARE DUE IN JANUARY OF 1967, AND THE AUTHORITY TO MAKE PAYMENTS IN LIEU OF TAXES HAVING EXPIRED DECEMBER 31, 1966, THE TAX BILL FOR THE CALENDAR YEAR 1967 MAY NOT BE PAID.

TO THE SECRETARY OF THE AIR FORCE, MARCH 23, 1967:

LETTER DATED FEBRUARY 21, 1967, FROM THE DEPUTY GENERAL COUNSEL, DEPARTMENT OF THE AIR FORCE, CONCERNS A PAYMENT IN LIEU OF TAXES TO THE CITY OF MILWAUKEE, WISCONSIN, UNDER SECTIONS 703 AND 704 (C) OF PUBLIC LAW 84-388, 69 STAT. 722, 723, AS AMENDED, 40 U.S.C. 523 AND 524 (C).

THE FACTS AND CIRCUMSTANCES GIVING RISE TO THE QUESTION PRESENTED ARE SET FORTH BELOW.

THE TREASURER OF THE CITY OF MILWAUKEE HAS REQUESTED THAT THE DEPARTMENT OF THE AIR FORCE PAY $64,140.82 IN LIEU OF SCHOOL, CITY AND COUNTY TAXES FOR CALENDAR YEAR 1966 PURSUANT TO THE AUTHORITY GRANTED BY PUBLIC LAW 84- 388, AS AMENDED. IN THE CERTIFICATION SUBMITTED WITH THE TAX BILL, THE TAX COMMISSIONER FOR THE CITY STATED, INTER ALIA, THAT THE TAXES INVOLVED WERE LEVIED ON DECEMBER 19, 1966; THE TAX BILL ITSELF BEARS THE NOTATION "TAXES DUE AND PAYABLE BEFORE FEB. 1, 1967.'

PUBLIC LAW 84-388 EXPIRED ON DECEMBER 31, 1966. BY ITS TERMS IT AUTHORIZES ONLY PAYMENTS IN LIEU OF TAXES BECOMING DUE PRIOR TO JANUARY 1, 1967. BY LETTER OF JANUARY 26, 1967, YOUR DEPARTMENT ADVISED THE CITY TREASURER THAT THERE WAS NO AUTHORITY TO MAKE THE REQUESTED PAYMENT, SINCE IT WAS YOUR DEPARTMENT'S VIEW THAT THE TAXES DID NOT BECOME DUE PRIOR TO JANUARY 1, 1967. IN SUPPORT OF THIS CONCLUSION YOUR DEPARTMENT CITED OUR DECISION OF JUNE 25, 1957, B 130749. IN A LETTER DATED FEBRUARY 8, 1967, THE FISCAL DIRECTOR OF THE DEPARTMENT OF INTERGOVERNMENTAL FISCAL LIAISON, CITY OF MILWAUKEE, TAKES THE POSITION THAT THE TAXES HERE INVOLVED BECAME DUE WHEN LEVIED, WHICH IN WISCONSIN, IS WHEN THE TAX ROLL IS DELIVERED TO THE LOCAL TREASURER WITH A WARRANT FOR COLLECTION. THUS, IN THE FISCAL DIRECTOR'S VIEW THE TAXES BECAME DUE ON DECEMBER 19, 1966.

IN YOUR DEPARTMENT'S OPINION THE TAXES HERE INVOLVED BECAME DUE ON JANUARY 31, 1967, THE LAST DATE ON WHICH PAYMENT COULD BE MADE WITHOUT THE IMPOSITION OF A PENALTY FOR LATE PAYMENT. THE DEPUTY GENERAL COUNSEL ADMITS THAT THIS IS THE LATEST POSSIBLE DUE DATE, AND THAT THE EARLIEST DUE DATE WOULD SEEM TO BE JANUARY 1, 1967, SINCE THIS IS THE DATE FROM WHICH INTEREST ON DELINQUENT TAXES IS COMPUTED. HE POINTS OUT THAT THIS APPEARS TO HAVE BEEN THE POSITION OF THE OFFICE OF THE CITY ATTORNEY OF MILWAUKEE WHEN THE QUESTION OF THE DUE DATE FOR THESE TAXES WAS CONSIDERED BY THE GENERAL ACCOUNTING OFFICE IN 1957; THAT AT THAT TIME AN ASSISTANT CITY ATTORNEY STATED THAT THE TAXES FOR 1954 "* * * BECAME DUE ON JANUARY 1, 1955 * * *" (36 COMP. GEN. 713, 715). THE DEPUTY GENERAL COUNSEL EXPRESSES THE VIEW THAT EVEN THIS INTERPRETATION, HOWEVER, DOES NOT ESTABLISH A DUE DATE, IN THE INSTANT CASE, PRIOR TO JANUARY 1, 1967, AS REQUIRED BY THE STATUTE AS A CONDITION TO PAYMENT.

IN VIEW OF THE CONFLICTING INTERPRETATIONS OF THE APPLICABLE PROVISIONS OF PUBLIC LAW 84-388 EXPRESSED BY THE CITY OF MILWAUKEE AND YOUR DEPARTMENT, THE DEPUTY GENERAL COUNSEL REQUESTS A DECISION AS TO WHETHER THE DEPARTMENT OF THE AIR FORCE HAS THE AUTHORITY TO MAKE THE PAYMENT IN LIEU OF TAXES REQUESTED BY THE CITY.

WE NOTE THAT THE FISCAL DIRECTOR OF THE DEPARTMENT OF INTERGOVERNMENTAL FISCAL LIAISON, CITY OF MILWAUKEE, IN HIS LETTER OF FEBRUARY 8, 1967, TO YOUR DEPUTY GENERAL COUNSEL STATES THAT:

YOUR LETTER OF JANUARY 26TH INDICATES THAT TAXES "FOR 1966" ARE NOT PAYABLE BECAUSE THE TAX BILL STATES THAT THEY ARE "DUE AND PAYABLE BEFORE FEBRUARY 1, 1967.' THIS VERY ARGUMENT WAS ALSO PRESENTED BY REPRESENTATIVES OF THE CITY OF MILWAUKEE TO THE COMPTROLLER GENERAL OF THE UNITED STATES IN 1957. AT THAT TIME, HE REJECTED THE ARGUMENT ON THE GROUNDS THAT WISCONSIN STATUTES DO NOT STATE A "DUE DATE" FOR TAXES. HELD THAT THE TAXES IN QUESTION AT THAT TIME BECAME "DUE" WHEN LEVIED ON THE THIRD MONDAY OF DECEMBER, AT WHICH TIME THE TAX ROLL IS CERTIFIED BY THE ASSESSOR TO THE CITY TREASURER. SINCE THIS "DUE DATE" WAS BEFORE JANUARY 1, 1955, THE CITY WAS NOT ELIGIBLE FOR PAYMENT IN 1955.

SECTION 703 OF PUBLIC LAW 84-388, AS AMENDED, 40 U.S.C. 523, READS AS FOLLOWS:

WHERE REAL PROPERTY HAS BEEN TRANSFERRED ON OR AFTER JANUARY 1, 1946, FROM THE RECONSTRUCTION FINANCE CORPORATION TO ANY GOVERNMENT DEPARTMENT, AND THE TITLE TO SUCH REAL PROPERTY HAS BEEN HELD BY THE UNITED STATES CONTINUOUSLY SINCE SUCH TRANSFER, THEN ON EACH DATE OCCURRING ON OR AFTER JANUARY 1, 1955, AND PRIOR TO JANUARY 1, 1967, ON WHICH REAL PROPERTY TAXES LEVIED BY ANY STATE OR LOCAL TAXING AUTHORITY WITH RESPECT TO ANY PERIOD BECOME DUE, THE GOVERNMENT DEPARTMENT WHICH HAS CUSTODY AND CONTROL OF SUCH REAL PROPERTY SHALL PAY TO THE APPROPRIATE STATE AND LOCAL TAXING AUTHORITIES AN AMOUNT EQUAL TO THE AMOUNT OF THE REAL PROPERTY TAX WHICH WOULD BE PAYABLE TO EACH SUCH STATE OR LOCAL TAXING AUTHORITY ON SUCH DATE IF LEGAL TITLE TO SUCH REAL PROPERTY HAD BEEN HELD BY A PRIVATE CITIZEN ON SUCH DATE AND DURING ALL PERIODS TO WHICH SUCH DATE RELATES.

SECTION 704 (C), AS AMENDED, 40 U.S.C. 524 (C), PROVIDES THAT:

NOTHING CONTAINED IN THIS SUBCHAPTER SHALL ESTABLISH ANY LIABILITY OF ANY GOVERNMENT DEPARTMENT FOR THE PAYMENT OF ANY PAYMENT IN LIEU OF TAXES WITH RESPECT TO ANY REAL PROPERTY FOR ANY PERIOD BEFORE JANUARY 1, 1955, OR AFTER DECEMBER 31, 1966.

IN OUR LETTER OF JUNE 25, 1957, B-130749, TO THE CITY ATTORNEY FOR THE CITY OF MILWAUKEE CONCERNING PAYMENTS IN LIEU OF TAXES THERE APPEARS THE FOLLOWING STATEMENT IN CONNECTION WITH SECTION 703:

CONCERNING A PAYMENT IN LIEU OF TAXES ON JANUARY 1, 1959, IT IS CLEAR THAT UNDER SECTION 703 OF PUBLIC LAW 388 PAYMENTS IN LIEU OF TAXES MAY BE MADE ONLY ON EACH DATE ON OR AFTER JANUARY 1, 1955, AND PRIOR TO JANUARY 1, 1959 ON WHICH REAL PROPERTY TAXES LEVIED BY A STATE OR LOCAL TAXING AUTHORITY BECOME DUE. THE WORK "PRIOR" IS SYNONYMOUS WITH THE WORD "BEFORE.' HENCE, SECTION 703 WOULD APPEAR TO PROHIBIT A PAYMENT IN LIEU OF TAXES WHEN THE TAXES BECOME DUE AFTER DECEMBER 31, 1958, REGARDLESS OF THE PERIOD REPRESENTED BY THE PAYMENT IN LIEU OF TAXES.

SECTION 703 SUBSEQUENTLY WAS AMENDED TO READ "PRIOR TO JANUARY 1, 1967.' HENCE, SECTION 703 WOULD NOW APPEAR TO PROHIBIT A PAYMENT IN LIEU OF TAXES WHEN THE TAXES BECOME "DUE" AFTER DECEMBER 31, 1966, REGARDLESS OF THE PERIOD REPRESENTED BY THE PAYMENT IN LIEU OF TAXES.

OUR LETTER OF JUNE 25, 1957, AS WELL AS OUR DECISION OF APRIL 17, 1957, 36 COMP. GEN. 713 AND OUR LETTER OF MARCH 27, 1958, B-130749, ALL CONCERN A PAYMENT IN LIEU OF TAXES TO THE CITY OF MILWAUKEE. THE CITY HAD CONTENDED THAT TAXES DUE AND PAYABLE IN JANUARY OF EACH YEAR WERE TAXES ,FOR" THAT YEAR AND NOT TAXES "FOR" THE PRIOR YEAR. IN BOTH THE LETTERS AND DECISION WE HELD THAT UNDER WISCONSIN LAW, TAXES DUE THE CITY OF MILWAUKEE IN JANUARY OF EACH YEAR ARE TAXES "FOR" THE PRECEEDING YEAR, THAT IS, THE "TAX LEVY YEAR.' ACCORDINGLY WE CONCLUDED THAT IN VIEW OF THE LIMITATION IN SECTION 704 (C) OF PUBLIC LAW 84-388, PROHIBITING PAYMENTS IN LIEU OF TAXES "WITH RESPECT TO ANY REAL PROPERTY FOR ANY PERIOD BEFORE JANUARY 1, 1955," THE CITY WAS NOT ENTITLED TO A PAYMENT IN LIEU OF TAXES FOR THE CALENDAR YEAR 1954, EVEN THOUGH THE TAX PAYMENT FOR THE CALENDAR YEAR 1954 WAS DUE IN JANUARY 1955. IN OUR DECISION OF APRIL 17, 1957, 36 COMP. GEN. 713, 718, WE STATED THAT:

IT IS CLEAR THAT THE PROVISING OF SECTION 703 ARE SUBJECT TO THE LIMITATIONS CONTAINED IN SECTION 704 INCLUDING THE LIMITATIONS SET FORTH IN SUBSECTION (C) OF THE LATTER SECTION. THEREFORE, UNDER PUBLIC LAW 388 THERE IS NO AUTHORITY TO MAKE A PAYMENT IN LIEU OF TAXES ON ANY REAL PROPERTY FOR ANY PERIOD PRIOR TO JANUARY 1, 1955. HENCE, IT IS CLEAR THAT UNDER THAT PUBLIC LAW YOUR DEPARTMENT MAY NOT MAKE A PAYMENT IN LIEU OF TAXES ON THE PROPERTY IN QUESTION FOR THE CALENDAR YEAR 1954, REGARDLESS OF THE DATE THE TAX PAYMENT IS DUE.

IT IS CLEAR FROM THE FOREGOING THAT THE CONCLUSION REACHED IN THE ABOVE MENTIONED LETTERS AND DECISION WAS NOT BASED ON THE DATE THE TAXES WERE "DUE," BUT RATHER ON THE PERIOD THE TAXES WERE ,FOR.' IN NEITHER THE LETTERS NOR DECISION DID WE REACH THE CONCLUSION THAT THE "DUE DATE" FOR TAXES FOR 1954 WAS ON THE THIRD MONDAY IN DECEMBER OF THAT YEAR AND THAT SINCE SUCH DATE WAS BEFORE JANUARY 1, 1955, THE CITY WAS NOT ELIGIBLE FOR A PAYMENT IN LIEU OF TAXES IN 1955.

AS TO THE "DUE DATE" OF WISCONSIN REAL PROPERTY TAXES, OUR RECORDS DISCLOSE THAT THE CITY IN THE PAST HAS ALWAYS TAKEN THE POSITION THAT IN WISCONSIN, OR AT LEAST IN MILWAUKEE, REAL PROPERTY TAXES ARE "DUE" IN JANUARY OF THE YEAR FOLLOWING THE TAX LEVY YEAR. AS INDICATED ABOVE, IN OUR LETTERS OR DECISION IN THE MATTER WE NEVER QUESTIONED THE CITY'S POSITION AS TO THE "DUE DATE" FOR REAL PROPERTY TAXES IN MILWAUKEE OR IN WISCONSIN. FURTHER, A COPY OF CITY OF MILWAUKEE CHARTER ORDNANCE NO. 164, APPROVED APRIL 26, 1951, PROVIDES, IN PERTINENT PART, THAT "* * * TAXES AND ASSESSMENTS ON REAL ESTATE MUST BE PAID BETWEEN THE FIRST DAY OF JANUARY AND THE LAST DAY OF JANUARY FOLLOWING.' MOREOVER, UNDER WISCONSIN LAW TAXES NOT PAID BY JANUARY 31 FOR THE PRIOR TAX LEVY YEAR ARE CONSIDERED DELINQUENT AND INTEREST ON DELINQUENT TAXES RUNS "FROM JANUARY 1ST SUCCEEDING THE YEAR OF THE TAX LEVIED.'

IN LIGHT OF THE FOREGOING IT IS OUR VIEW THAT MILWAUKEE REAL ESTATE

IN LIGHT OF THE FOREGOING IT IS OUR VIEW THAT MILWAUKEE REAL ESTATE TAXES FOR THE TAX LEVY YEAR 1966 ARE "DUE" IN JANUARY 1967. INSOFAR AS THE INSTANT CASE IS CONCERNED IT IS IMMATERIAL WHETHER SUCH TAXES BE CONSIDERED "DUE" ON JANUARY 1, OR 31, 1967. SINCE THE MILWAUKEE REAL PROPERTY TAXES FOR CALENDAR YEAR OR TAX LEVY YEAR 1966 ARE DUE IN JANUARY OF 1967, THERE WOULD BE NO AUTHORITY TO MAKE A PAYMENT IN LIEU OF SUCH TAXES UNDER PUBLIC LAW 84-388, AS AMENDED, INASMUCH AS THE "DUE DATE" OF THE TAXES FOR WHICH THE IN LIEU PAYMENT IS TO BE MADE IS NOT PRIOR TO JANUARY 1, 1967.

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