B-130749, APRIL 17, 1957, 36 COMP. GEN. 713

B-130749, APRIL 17, 1957, 36 COMP. GEN. 713

TAXES - MUNICIPAL REAL ESTATE TAX PAID ON GOVERNMENT-OWNED PROPERTY BY GOVERNMENT CONTRACTOR - SET-OFF A REAL ESTATE TAX WHICH WAS UNLAWFULLY LEVIED BY A MUNICIPALITY ON PROPERTY OWNED BY THE FEDERAL GOVERNMENT AND WHICH WAS COLLECTED FROM A GOVERNMENT CONTRACTOR WHO WAS REIMBURSED FOR THE TAX BY THE GOVERNMENT IS A DEBT DUE THE UNITED STATES, AND THE GENERAL ACCOUNTING OFFICE IS REQUIRED TO SET OFF THE DEBT AGAINST A PAYMENT IN LIEU OF TAXES DUE THE MUNICIPALITY FOR A SUBSEQUENT YEAR PURSUANT TO 40 U.S.C. 523, NOTWITHSTANDING A STATE LAW WHICH PRECLUDES THE SETOFF OF A TAX REFUND DUE IN 1 YEAR BECAUSE OF ILLEGALITY AGAINST A VALID TAX DUE IN ANOTHER YEAR. A STATE STATUTE OF LIMITATIONS ON CLAIMS FOR REFUND OF TAXES UNLAWFULLY COLLECTED MAY NOT BE INVOKED TO BAR A CLAIM OF THE UNITED STATES FOR THE REFUND OF TAXES UNLAWFULLY LEVIED AND COLLECTED BY A STATE ON PROPERTY OWNED BY THE UNITED STATES. UNDER SECTION 704 (C) OF THE FEDERAL PROPERTY AND ADMINISTRATIVE SERVICES ACT OF 1949, WHICH PRECLUDES PAYMENTS IN LIEU OF TAXES ON FEDERAL REAL PROPERTY FOR PERIODS PRIOR TO JANUARY 1, 1955, THE DEPARTMENT OF THE AIR FORCE MAY NOT MAKE A TAX PAYMENT TO A MUNICIPALITY FOR THE CALENDAR YEAR 1954, REGARDLESS OF THE FACT THAT THE TAX PAYMENT FOR THAT YEAR IS DUE ON JANUARY 1, 1955. THE FAILURE OF THE FEDERAL GOVERNMENT TO NOTIFY A MUNICIPALITY THAT TITLE TO PROPERTY HAD BEEN CONVEYED FROM THE RECONSTRUCTION FINANCE CORPORATION TO THE GENERAL SERVICES ADMINISTRATION, THEREBY CHANGING IT FROM A TAXABLE TO A NONTAXABLE STATUS, DOES NOT AFFECT THE LIABILITY OF THE UNITED STATES FOR TAXES SUBSEQUENT TO THE TRANSFER.

TO THE SECRETARY OF THE AIR FORCE, APRIL 17, 1957:

ON FEBRUARY 14, 1957, THE ASSISTANT SECRETARY OF THE AIR FORCE REQUESTED OUR DECISION AS TO THE PROPRIETY OF EFFECTING A CERTAIN OFFSET AGAINST PAYMENTS IN LIEU OF TAXES FOR 1956 TO BE MADE TO THE CITY OF MILWAUKEE, WISCONSIN.

THE INDEBTEDNESS OF THE CITY TO THE UNITED STATES ARISES BECAUSE OF CERTAIN REAL ESTATE TAXES WHICH WERE PAID BY THE A.C. SPARK PLUG DIVISION, GENERAL MOTORS CORPORATION, ON AIR FORCE BUILDING NO. 10058 LOCATED IN MILWAUKEE, WHICH IT OCCUPIED. WE ARE ADVISED THAT THE CONTRACTOR PAID TAXES ON THIS FACILITY FOR THE PERIOD 1950 THROUGH 1954. IT IS REPORTED THAT THE REAL ESTATE TAXES PAID WERE "REIMBURSED" BY THE AIR FORCE IN THE SENSE THAT ACCRUALS FOR THE ESTIMATED AMOUNTS OF SUCH TAXES WERE ALLOWED IN THE OVERHEAD COSTS CHARGED TO NEGOTIATED GOVERNMENT CONTRACTS. IN THE LIGHT OF OUR HOLDINGS IN 32 COMP. GEN. 164, AND B-119949, DATED FEBRUARY 17, 1955, IT APPEARS THAT OUR CHICAGO REGIONAL AUDIT OFFICE HAS REQUESTED YOUR DEPARTMENT TO RECOVER THE 1954 TAXES PAID BY THE CONTRACTOR TO THE CITY. THE AMOUNT OF THE TAXES FOR 1954 WAS PAID BY THE CONTRACTOR TO THE CITY UNDER PROTEST ON JANUARY 27, 1955. FROM THE REPORT FURNISHED IT DOES NOT APPEAR THAT THE CONTRACTOR HAD KNOWLEDGE AT THAT TIME THAT A DEED CONVEYING THE PROPERTY INVOLVED FROM THE RECONSTRUCTION FINANCE CORPORATION TO THE UNITED STATES ( GENERAL SERVICES ADMINISTRATION) HAD BEEN FILED, FOR RECORDING WITH THE REGISTRAR OF DEEDS, CITY OF MILWAUKEE, ON DECEMBER 7, 1953.

WE ARE ADVISED THAT THE CITY HAS REFUSED TO VOLUNTARILY REFUND TO THE AIR FORCE THE 1954 TAXES PAID, AND THAT THE CITY DENIES ITS LIABILITY ON THE GROUND THAT SECTION 74.73, WISCONSIN STATUTES, IMPOSES A 1-YEAR STATUTE OF LIMITATIONS UPON CLAIMS FOR THE REFUND OF TAXES UNLAWFULLY COLLECTED. APPEARS FROM THE FACTS REPORTED THAT YOUR DEPARTMENT IS CONSIDERING PAYING THE CITY $41,661.68 PURSUANT TO PUBLIC LAW 388, 84TH CONGRESS (69 STAT. 721; 40 U.S.C. 521-524), AS A PAYMENT IN LIEU OF TAXES FOR 1956 ON THE SAME PROPERTY AND THAT THE QUESTION OF EFFECTING AN OFFSET HAS ARISEN. ACCORDINGLY, YOUR DEPARTMENT REQUESTS OUR DECISION AS TO WHETHER IT WOULD BE PROPER TO OFFSET THE $38,982.72 IN 1954 TAXES PAID BY, AND "REIMBURSED" BY THE GOVERNMENT TO, THE CONTRACTOR AGAINST THE PAYMENT IN LIEU OF TAXES TO BE MADE THE CITY FOR THE YEAR 1956.

AS INDICATED IN OUR LETTER OF MARCH 6, 1957, TO YOU, THE TAX COMMISSIONER OF THE CITY REQUESTED THAT WE DEFER OUR DECISION UNTIL HE DETERMINED WHETHER THE CITY WOULD SUBMIT ANY FURTHER COMMENTS IN THE MATTER. THESE COMMENTS HAVE BEEN RECEIVED AND THE CITY CONTENDS, IN A LETTER SIGNED BY AN ASSISTANT CITY ATTORNEY, THAT THE PROPOSED OFFSET IS IMPROPER NOT ONLY BECAUSE OF THE PROVISIONS OF THE ABOVE REFERRED-TO STATUTE OF LIMITATIONS BUT ALSO FOR THE FOLLOWING TWO REASONS:

IN THE SECOND PLACE, IT IS OUR POSITION THAT IT IS IMPROPER TO OFFSET ONE YEAR'S TAXES AGAINST ANOTHER YEAR'S TAXES SINCE UNDER THE LAW PREVAILING IN THE STATE OF WISCONSIN EACH TAX ROLL STANDS UPON ITS OWN MERITS AND A REFUND DUE IN ONE YEAR BECAUSE OF ILLEGALITY CANNOT BE OFFSET AGAINST A VALID YEAR'S TAXES DUE IN ANOTHER YEAR, THE SECOND YEAR'S TAXES BEING VALID AND UNIMPEACHABLE.

THIRD, WE WISH TO POINT OUT THAT PUBLIC LAW 388 OF THE 84TH CONGRESS, OTHERWISE KNOWN AS H.R. 6182 WHICH IS THE STATUTE IN QUESTION, REQUIRES A PAYMENT IN LIEU ON PROPERTIES OTHERWISE NONTAXABLE IN ANY YEAR IN WHICH SUCH TAXES WOULD HAVE BECOME DUE. SINCE THE 1954 TAXES WHICH WERE PAID BECAME DUE ON JANUARY 1, 1955, IT WOULD SEEM CLEAR THAT EVEN IF YOUR OFFICE SHOULD RULE THAT AN OFFSET WERE PROPER, THAT IN THAT EVENT THE UNITED STATES GOVERNMENT WOULD OWE AN IN LIEU PAYMENT EQUIVALENT TO THE AMOUNT OF SUCH PAYMENT MADE. IN ANY EVENT, THEREFORE, THE UNITED STATES GOVERNMENT WOULD EITHER OWE TAXES TO THE CITY OF MILWAUKEE IN THE SUM OF $38,982.72 OR IN THE ALTERNATIVE WOULD OWE AN IN LIEU PAYMENT IN THE SAME AMOUNT BECAUSE PUBLIC LAW 388 OF THE 84TH CONGRESS REQUIRES THAT THE GOVERNMENTAL DEPARTMENT WHICH HAS CUSTODY AND CONTROL SHALL PAY TO THE APPROPRIATE TAXING AUTHORITIES AN AMOUNT EQUAL TO THE AMOUNT OF THE REAL PROPERTY TAX WHICH WOULD BE PAID TO SUCH TAXING AUTHORITY ON SUCH DATE IF LEGAL TITLE TO SUCH PROPERTY HAD BEEN HELD BY A PRIVATE CITIZEN.

IN OTHER CORRESPONDENCE THE TAX COMMISSIONER OF THE CITY CONTENDS THAT THERE WAS NO NOTICE TO THE CITY OF THE TRANSFER OF THIS FACILITY TO A NONTAXABLE AGENCY OF THE UNITED STATES UNTIL JULY 1955. HE STATES THAT THIS NOTICE WAS RECEIVED IN A LETTER FROM THE GENERAL TAX COUNSEL OF THE GENERAL MOTORS CORPORATION. HE FURTHER STATES, HOWEVER, THAT A DEED FROM THE GENERAL SERVICES ADMINISTRATION TO THE AIR FORCE WAS RECORDED IN 1953 BUT THE LETTER ACCOMPANYING THE DEED AND INDICATING TO THE REGISTRAR OF DEEDS THE NONTAXABLE NATURE OF THE PROPERTY THEREAFTER WAS NEVER RECEIVED BY HIS OFFICE. AS INDICATED ABOVE THE DEED FILED FOR RECORDING IN 1953 CONVEYED THE PROPERTY FROM THE RECONSTRUCTION FINANCE CORPORATION TO THE UNITED STATES ( GENERAL SERVICES ADMINISTRATION). THE GENERAL SERVICES ADMINISTRATION TRANSFERRED TITLE TO THE PROPERTY TO THE AIR FORCE IN MAY 1955.

THE COURTS OF THE UNITED STATES AND OF THE VARIOUS STATES CONSISTENTLY HAVE HELD THAT FEDERAL PROPERTY IS NOT, IN THE ABSENCE OF SPECIFIC AUTHORIZATION BY THE CONGRESS, SUBJECT TO TAXATION BY STATES OR LOCAL GOVERNMENTS. M-CULLOCH V. MARYLAND, 4 WHEAT. 316; VAN BROCKLIN V. TENNESSEE, 117 U.S. 151. HOWEVER, IN AUTHORIZING FEDERAL PROGRAMS TO BE CONDUCTED UNDER PRACTICES EMPLOYED BY PRIVATE CORPORATIONS, THE CONGRESS CREATED OR AUTHORIZED TO BE CREATED BY THE RECONSTRUCTION FINANCE CORPORATION ACT, 15 U.S.C. 601, ET SEQ., GOVERNMENT-OWNED CORPORATIONS WITH POWER TO HOLD LEGAL TITLE TO, AND EXERCISE DOMINION OVER, REAL PROPERTY AND TO PAY STATE AND LOCAL TAXES THEREON TO THE SAME EXTENT AS OTHER REAL PROPERTY IS TAXED. THE AUTHORITY THUS VESTED IN GOVERNMENT- OWNED CORPORATIONS TO PAY LOCAL TAXES ON THEIR REAL PROPERTY IS, HOWEVER, CONTINGENT UPON THE CORPORATION BOTH HOLDING LEGAL TITLE TO, AND HAVING FULL CONTROL AND DOMINION OVER, SUCH PROPERTY. SEE UNITED STATES V. SHOFNER IRON AND STEEL WORKS, 168 F.2D 286; THE BOARD OF COUNTY COMMISSIONERS OF SEDGWICK COUNTY, STATE OF KANSAS V. UNITED STATES, 105 F.1SUPP. 995; AND 32 COMP. GEN. 164.

IN THE INSTANT CASE IT APPEARS FROM THE RECORD THAT THE TITLE TO THIS PROPERTY WAS TRANSFERRED FROM THE RECONSTRUCTION FINANCE CORPORATION TO THE UNITED STATES ( GENERAL SERVICES ADMINISTRATION) BY A QUITCLAIM DEED DATED JULY 10, 1950, AND THAT THE DEED WAS FILED FOR RECORD WITH THE REGISTRAR OF DEEDS OF MILWAUKEE COUNTY ON DECEMBER 7, 1953. THUS, IT IS CLEAR THAT THE PROPERTY WAS HELD BY AND FOR THE USE OF THE UNITED STATES IN A NONTAXABLE STATUS DURING THE CALENDAR YEAR 1954. IT FURTHER APPEARS THAT EFFECTIVE MAY 1, 1955, TITLE TO THE PROPERTY WAS TRANSFERRED FROM ONE AGENCY OF THE UNITED STATES TO ANOTHER, NAMELY, FROM THE GENERAL SERVICES ADMINISTRATION TO THE CORPS OF ENGINEERS ON BEHALF OF THE AIR FORCE. THIS LATTER TRANSFER, HOWEVER, HAD NO EFFECT ON THE TAXABLE STATUS OF THE PROPERTY, SINCE, AS INDICATED ABOVE, THE PROPERTY WAS HELD BY AND FOR THE USE OF THE UNITED STATES PRIOR TO THE BEGINNING OF THE CALENDAR YEAR 1954.

CONCERNING THE WISCONSIN STATUTE OF LIMITATIONS INVOLVED HERE, IT IS A WELL-ESTABLISHED CONSTITUTIONAL PRINCIPLE THAT THE UNITED STATES IS NOT BOUND BY STATE STATUTES OF LIMITATIONS OR SUBJECT TO THE DEFENSE OF LACHES IN ENFORCING ITS RIGHTS. WHEN THE UNITED STATES BECOMES ENTITLED TO A CLAIM, ACTING IN ITS GOVERNMENTAL CAPACITY, AND ASSERTS ITS CLAIM IN THAT RIGHT, IT CANNOT BE DEEMED TO HAVE ABDICATED ITS GOVERNMENTAL AUTHORITY SO AS TO BECOME SUBJECT TO A STATE STATUTE PUTTING A TIME LIMIT UPON ITS ENFORCEMENT. UNITED STATES V. SUMMERLIN, 310 U.S. 414; UNITED STATES V. GIBSON, 101 F.1SUPP. 225. CONSEQUENTLY, A STATUTE OF LIMITATIONS OF THE STATE OF WISCONSIN MAY NOT OPERATE TO BAR A CLAIM OF THE FEDERAL GOVERNMENT.

WHILE IN THE INSTANT CASE THE CONTRACTOR PAID THE TAXES, HE WAS REIMBURSED BY THE UNITED STATES, APPARENTLY AS PART OF THE OVERHEAD COSTS CHARGEABLE TO NEGOTIATED GOVERNMENT CONTRACTS. THE UNITED STATES WAS THE OWNER OF THE PROPERTY IN QUESTION DURING THE CALENDAR YEAR 1954 AND UNDER WISCONSIN LAW REAL PROPERTY TAXES ARE LEVIED AGAINST THE PROPERTY ( WISCONSIN STATUTES 70.01) AND ASSESSED AGAINST THE OWNER--- IF KNOWN--- ( WISCONSIN STATUTES 70.17). THEREFORE, AND SINCE THE UNITED STATES REIMBURSED THE CONTRACTOR THE TAXES THE CONTRACTOR PAID ON THE GOVERNMENT- OWNED PROPERTY, IT IS CLEAR THAT THE GOVERNMENT IS THE REAL PARTY IN INTEREST IN THIS MATTER. IT IS ALSO CLEAR, IN VIEW OF WHAT HAS BEEN STATED ABOVE, THAT THE WISCONSIN STATUTE OF LIMITATIONS REFERRED TO ABOVE WOULD NOT BE FOR APPLICATION HERE.

THE CONTENTION OF THE ASSISTANT CITY ATTORNEY THAT IT IS IMPROPER FOR THE UNITED STATES TO OFFSET 1 YEAR'S TAXES AGAINST ANOTHER YEAR'S TAXES IS WITHOUT MERIT. IT MAY BE THAT UNDER THE LAW PREVAILING IN THE STATE OF WISCONSIN EACH TAX ROLL STANDS UPON ITS OWN MERITS AND A REFUND DUE IN 1 YEAR BECAUSE OF ILLEGALITY CANNOT BE OFFSET AGAINST A VALID YEAR'S TAXES DUE IN ANOTHER YEAR, THE SECOND YEAR'S TAXES BEING VALID AND UNIMPEACHABLE. HOWEVER, WE SHOULD LIKE TO POINT OUT THAT OUR OFFICE, BY SECTION 305 OF THE BUDGET AND ACCOUNTING ACT OF JUNE 10, 1921, 42 STAT. 24, 31 U.S.C. 71, IS REQUIRED TO SETTLE AND ADJUST ALL CLAIMS, BOTH IN FAVOR OF AND AGAINST THE UNITED STATES. BY NECESSARY IMPLICATION, WHENEVER THERE IS INVOLVED ANY CLAIM OR DEMAND WHATEVER BY THE UNITED STATES AGAINST ANYONE WHO HAS A CLAIM AGAINST THE GOVERNMENT, WE NOT ONLY HAVE THE AUTHORITY BUT ARE REQUIRED, IN THE PROPER DISCHARGE OF OUR DUTIES, TO SETTLE AND ADJUST THE OPPOSING CLAIMS OR DEMANDS, TO SET OFF ONE INDEBTEDNESS AGAINST THE OTHER AND TO CERTIFY FOR PAYMENT OR COLLECTION ONLY THE NET BALANCE. SEE 28 COMP. GEN. 543. IN THAT CONNECTION, THE COURTS HAVE HELD THAT THE UNITED STATES HAS THE SAME RIGHT WHICH BELONGS TO EVERY CREDITOR TO APPLY UNAPPROPRIATED MONIES OF HIS DEBTOR IN HIS HANDS, IN EXTINGUISHMENT OF THE DEBT DUE HIM. SEE UNITED STATES V. LOUISIANA, 127 U.S. 182; UNITED STATES V. MUNSEY TRUST COMPANY, 332 U.S. 234; AND SEABOARD SURETY CO. V. UNITED STATES, 67 F.1SUPP. 969. ALSO, IN THE CASE OF UNITED STATES V. LOUISIANA, SUPRA, THE SUPREME COURT OF THE UNITED STATES IN SUSTAINING THE PLEA OF SETOFF INTERPOSED BY THE UNITED STATES IN THAT CASE, UPHELD THE ACTION PREVIOUSLY TAKEN BY THE FIRST COMPTROLLER OF THE TREASURY IN APPLYING CERTAIN AMOUNTS OTHERWISE PAYABLE TO THE STATE OF LOUISIANA UNDER THE PROVISIONS OF ACTS OF CONGRESS THERE INVOLVED, AGAINST THE STATE'S INDEBTEDNESS TO THE FEDERAL GOVERNMENT ON ACCOUNT OF THE UNPAID INTEREST ON CERTAIN BONDS WHICH HAD BEEN ISSUED BY THE STATE AND WERE HELD BY THE UNITED STATES. THUS, IT IS TO BE SEEN THAT WHENEVER ANY DEBT DUE THE UNITED STATES IS OF RECORD IN, OR REPORTED TO US, IT BECOMES OUR DUTY TO PROTECT THE INTERESTS OF THE UNITED STATES BY WITHHOLDING THE AMOUNT OF SUCH INDEBTEDNESS FROM ANY PAYMENT TO WHICH THE DEBTOR THEREAFTER OTHERWISE MAY BECOME ENTITLED. SINCE SETOFF HERE WOULD BE EFFECTED PURSUANT TO FEDERAL LAW AND FEDERAL COURT DECISIONS, IT MAY NOT BE SAID THAT THE SETOFF ACTION IS ILLEGAL UNDER STATE OR LOCAL TAX STATUTES.

AS TO THE THIRD CONTENTION OF THE ASSISTANT CITY ATTORNEY THAT SINCE THE 1954 TAXES BECAME DUE ON JANUARY 1, 1955, UNDER SECTION 703 OF PUBLIC LAW 388, 40 U.S.C. 523, THE CITY IS ENTITLED TO A PAYMENT IN LIEU OF TAXES FOR 1954, WE DO NOT SO CONSTRUE THE PROVISIONS OF THAT PUBLIC LAW. SECTION 703 OF PUBLIC LAW 388 DOES PROVIDE, IN PERTINENT PART, THAT: * * * ON EACH DATE OCCURRING ON OR AFTER JANUARY 1, 1955, AND PRIOR TO JANUARY 1, 1959, 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. ( ITALICS SUPPLIED.) HOWEVER, SECTION 704 (C) OF THAT PUBLIC LAW, 40 U.S.C. 524 (C), UNDER THE SUBHEADING " LIMITATIONS" PROVIDES:

NOTHING CONTAINED IN THIS TITLE 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, 1958. ( ITALICS SUPPLIED.)

IT IS CLEAR THAT THE PROVISIONS 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. CONCERNING THE QUESTION OF NOTICE RAISED BY THE TAX COMMISSIONER OF THE CITY, SINCE THE QUITCLAIM DEED CONVEYING THE PROPERTY FROM THE RECONSTRUCTION FINANCE CORPORATION TO THE UNITED STATES ( GENERAL SERVICES ADMINISTRATION) WAS FILED FOR RECORD WITH THE REGISTRAR OF DEEDS OF MILWAUKEE COUNTY ON DECEMBER 7, 1953, IT APPEARS THAT THE CITY MUST BE CONSIDERED AS HAVING HAD CONSTRUCTIVE NOTICE THAT TITLE TO THE PROPERTY HAD VESTED IN THE UNITED STATES. CF. UNITED STATES V. NEZ PERCE COUNTY, IDAHO, ET AL., 50 F.1SUPP. 966. AS THE SUPREME COURT OF WISCONSIN STATED IN JESKE V. HOTZ MFG. CO., 290 N.W. 208: * * * THE PURPOSE OF RECORDING INSTRUMENTS IS TO GIVE NOTICE. * * * IN ANY EVENT FAILURE OF THE UNITED STATES TO NOTIFY THE CITY OF MILWAUKEE THAT TITLE TO THE PROPERTY HAD BEEN CONVEYED TO THE UNITED STATES, WOULD HAVE NO EFFECT ON THE LEGAL LIABILITY OF THE UNITED STATES FOR TAXES ON THE PROPERTY FOR THE YEAR IN QUESTION.

IN VIEW OF WHAT HAS BEEN STATED ABOVE YOU ARE ADVISED THAT THE AMOUNT OF THE TAXES PAID THE CITY OF MILWAUKEE BY THE CONTRACTOR AND REIMBURSED THE CONTRACTOR BY YOUR DEPARTMENT SHOULD BE SET OFF AGAINST THE AMOUNT DUE THE CITY UNDER PUBLIC LAW 388 AS A PAYMENT IN LIEU OF TAXES FOR THE CALENDAR YEAR 1956.