B-48776, JULY 4, 1945, 25 COMP. GEN. 10

B-48776: Jul 4, 1945

Additional Materials:

Contact:

Edda Emmanuelli Perez
(202) 512-2853
EmmanuelliPerezE@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

LICENSE FEES FOR TAX-EXEMPT GASOLINE PURCHASES IN NORTH DAKOTA FEES FOR LICENSES REQUIRED BY THE STATE OF NORTH DAKOTA AS A CONDITION PRECEDENT TO THE PURCHASE OF GASOLINE FOR NON-HIGHWAY PURPOSES WITHOUT PAYMENT OF THE OTHERWISE APPLICABLE STATE TAX THEREON ARE PAYABLE FROM FEDERAL FUNDS TO THE EXTENT NECESSARY TO ENABLE THE UNITED STATES TO AVAIL ITSELF OF THE PRIVILEGE OF SUCH TAX EXEMPTION ON THE SAME TERMS AS ARE APPLICABLE TO PRIVATE USERS. 3 COMP. 1945: REFERENCE IS MADE TO YOUR LETTER OF MARCH 20. AS FOLLOWS: THERE IS ATTACHED FOR YOUR ADVANCE DECISION BUREAU VOUCHER 15490 IN FAVOR OF THE STATE AUDITOR OF NORTH DAKOTA COVERING THE PURCHASE OF FOUR LICENSES FOR USE BY THE SOIL CONSERVATION SERVICE TO PURCHASE NON HIGHWAY FUEL IN THE STATE EXEMPT FROM THE STATE MOTOR VEHICLE FUEL TAX.

B-48776, JULY 4, 1945, 25 COMP. GEN. 10

LICENSE FEES FOR TAX-EXEMPT GASOLINE PURCHASES IN NORTH DAKOTA FEES FOR LICENSES REQUIRED BY THE STATE OF NORTH DAKOTA AS A CONDITION PRECEDENT TO THE PURCHASE OF GASOLINE FOR NON-HIGHWAY PURPOSES WITHOUT PAYMENT OF THE OTHERWISE APPLICABLE STATE TAX THEREON ARE PAYABLE FROM FEDERAL FUNDS TO THE EXTENT NECESSARY TO ENABLE THE UNITED STATES TO AVAIL ITSELF OF THE PRIVILEGE OF SUCH TAX EXEMPTION ON THE SAME TERMS AS ARE APPLICABLE TO PRIVATE USERS. 3 COMP. GEN. 663, DISTINGUISHED.

COMPTROLLER GENERAL WARREN TO L. E. LYMAN, DEPARTMENT OF AGRICULTURE, JULY 4, 1945:

REFERENCE IS MADE TO YOUR LETTER OF MARCH 20, 1945, AS FOLLOWS:

THERE IS ATTACHED FOR YOUR ADVANCE DECISION BUREAU VOUCHER 15490 IN FAVOR OF THE STATE AUDITOR OF NORTH DAKOTA COVERING THE PURCHASE OF FOUR LICENSES FOR USE BY THE SOIL CONSERVATION SERVICE TO PURCHASE NON HIGHWAY FUEL IN THE STATE EXEMPT FROM THE STATE MOTOR VEHICLE FUEL TAX.

IT IS RECOGNIZED THAT THE FEDERAL GOVERNMENT IS NOT EXEMPT FROM PAYMENT OF THE NORTH DAKOTA MOTOR VEHICLE FUEL TAX, 20 C.G. 843. HOWEVER, ACCORDING TO THE STATE AUTHORITIES FUEL PURCHASED FOR NON HIGHWAY PURPOSES MAY BE SECURED EXEMPT FROM THE FOUR CENTS PER GALLON STATE TAX IF THE PURCHASER IS GRANTED A LICENSE BY THE STATE AUDITOR, AT A FEE OF FIFTY CENTS EACH, TO PRESENT TO THE VENDOR AT THE TIME OF PURCHASE AS EVIDENCE THAT HE HAS AUTHORITY TO PURCHASE TAX EXEMPT FUEL. WITHOUT SUCH EVIDENCE THE PRIVILEGE IS DENIED.

THE SOIL CONSERVATION SERVICE PURCHASES A CONSIDERABLE QUANTITY OF NON- HIGHWAY FUEL TO CARRY ON IT OPERATIONS IN THE STATE AND THERE IS NO QUESTION BUT WHAT THE SAVINGS IN THE MOTOR VEHICLE FUEL TAX FAR OUTWEIGHS THE NOMINAL COST OF THE LICENSES. HOWEVER, THERE IS FOR CONSIDERATION DECISIONS OF YOUR OFFICE WHICH WOULD INDICATE THAT THE PAYMENT OF SUCH FEE IS NOT PERMISSIBLE FROM PUBLIC FUNDS. IN 3 C.G. 663 IT IS STATED.

"THE QUESTION OF THE AUTHORITY OF A STATE TO REQUIRE FEDERAL EMPLOYEES WHO, IN THE DISCHARGE OF THEIR OFFICIAL DUTIES, ARE ENGAGED IN OCCUPATIONS, WHICH ARE THE SUBJECT OF STATE REGULATIONS THROUGH THE ISSUE OF PERMITS OR LICENSES, HAS FREQUENTLY BEEN BEFORE THE ACCOUNTING OFFICERS AND THE COURTS, AND IT HAS UNIFORMLY BEEN HELD THAT THE EMPLOYEES SO ENGAGED ARE NOT REQUIRED TO OBTAIN THE PERMITS OR LICENSES REQUIRED TO BE OBTAINED BY THE GENERAL PUBLIC.'

SINCE THE STATE AUDITOR HAS INFORMED THIS OFFICE THAT SHOULD PAYMENT ON THE ATTACHED VOUCHER BE REFUSED, IT WILL BE NECESSARY TO WITHDRAW AND CANCEL THE LICENSES, I WOULD APPRECIATE YOUR DECISION AS TO WHETHER OR NOT THE ACCOUNT MAY BE PAID FROM PUBLIC FUNDS.

IN 3 COMP. GEN. 663, REFERRED TO IN YOUR ABOVE-QUOTED LETTER, IT WAS HELD (QUOTING SYLLABUS):

THE FACILITIES OF THE FEDERAL GOVERNMENT ARE NOT SUBJECT TO LOCAL CITY ORDINANCES OR REGULATIONS AND WHERE SUCH AN ORDINANCE OR REGULATION OF A MUNICIPAL FIRE DEPARTMENT REQUIRES THAT A PERMIT BE OBTAINED FOR THE OPERATION OF A GASOLINE PUMP, SUCH PERMIT TO BE ISSUED UPON EXAMINATION AND PAYMENT OF A FEE, A FEDERAL EMPLOYEE, WHOSE OFFICIAL DUTIES REQUIRE THE OPERATION OF A FEDERAL GASOLINE PUMP, IS NOT REQUIRED TO STAND THE EXAMINATION OR TO PAY THE FEE.

THE SAID DECISION AND THE OTHER DECISIONS OF THE ACCOUNTING OFFICERS AND THE COURTS REFERRED TO THEREIN NEGATIVE THE AUTHORITY OF STATES OR MUNICIPALITIES TO CONTROL AGENTS OR INSTRUMENTALITIES OF THE UNITED STATES IN THE PERFORMANCE OF THEIR DUTIES AS SUCH AGENTS OR INSTRUMENTALITIES. HOWEVER, THE INSTANT MATTER DOES NOT INVOLVE ANY QUESTION OF ATTEMPTED CONTROL OF FEDERAL AGENTS OR INSTRUMENTALITIES BY THE STATE OF NORTH DAKOTA, OR THE IMPOSITION OF A TAX ON FEDERAL ACTIVITIES, BUT RATHER INVOLVES THE GRANTING OF A PRIVILEGE BY THE STATE TO SUCH AGENTS OR INSTRUMENTALITIES, CONDITIONED ON CERTAIN REQUIREMENTS WHICH ARE APPLICABLE TO ALL SEEKING THE SAID PRIVILEGE. PAYMENT OF THE INVOLVED LICENSE FEES FOR THE PRIVILEGE OF OBTAINING TAX EXEMPT GASOLINE FOR NON- HIGHWAY PURPOSES IS NOT A TAX BUT APPEARS TO BE ANALOGOUS TO PAYMENT OF FEES FOR THE PRIVILEGE OF RECORDING DEEDS, ETC., IN COUNTY RECORDS, OR PAYMENT OF WATER RENTAL, ETC., TO MUNICIPALITIES, OR PAYMENT OF STATE COURT FEES, ALL OF WHICH PAYMENTS ARE, IN GENERAL, PROPERLY PAYABLE FROM APPROPRIATED MONEYS. SEE, FOR EXAMPLE, FEDERAL BANK OF NEW ORLEANS V. CROSLAND, 261 U.S. 374, WHEREIN THE COURT SAID, WITH RESPECT TO A FEE FOR RECORDING A MORTGAGE HELD BY THE UNITED STATES: ,OF COURSE THE STATE IS NOT BOUND TO FURNISH ITS REGISTRY FOR NOTHING. IT MAY CHARGE A REASONABLE FEE TO MEET THE EXPENSES OF THE INSTITUTION.'

AS HELD IN 21 COMP. GEN. 843, REFERRED TO IN YOUR LETTER, A VENDOR OF GASOLINE TO THE UNITED STATES IS NOT EXEMPT FROM PAYMENT OF THE STATE GASOLINE TAX IMPOSED BY THE NORTH DAKOTA STATUTE AND THE UNITED STATES MUST PAY THE FULL PRICE OF GASOLINE, INCLUSIVE OF THE SAID STATE TAX, INASMUCH AS THE LEGAL INCIDENCE OF THE TAX IS UPON THE VENDOR AND NOT UPON THE UNITED STATES. CONSEQUENTLY, THE UNITED STATES STANDS IN THE SAME POSITION AS A PRIVATE VENDEE OF GASOLINE WITH RESPECT TO PAYMENT OF THE AMOUNT OF THE TAX, AND THERE IS NOT PERCEIVED ANY OBJECTION TO MAKING PAYMENT OF SUCH LICENSE FEES AS NECESSARY TO ENABLE THE UNITED STATES TO AVAIL ITSELF OF THE PRIVILEGE OF EXEMPTION FROM PAYMENT OF THE AMOUNT OF THE SAID STATE TAX ON GASOLINE FOR NON-HIGHWAY USE ON THE SAME TERMS AS APPLICABLE TO PRIVATE USERS.

IN SPECIFIC ANSWER TO YOUR INQUIRY, YOU ARE ADVISED THAT THE VOUCHER TRANSMITTED WITH YOUR LETTER MAY BE CERTIFIED FOR PAYMENT, IF OTHERWISE CORRECT.