B-66821, JULY 17, 1947, 27 COMP. GEN. 20

B-66821, JULY 17, 1947, 27 COMP. GEN. 20

STATE OR LOCAL IMPROVEMENTS - ASSESSMENTS AGAINST GOVERNMENT PROPERTY - GOVERNMENT LIABILITY AN ASSESSMENT FOR STREET IMPROVEMENTS LEVIED BY A MUNICIPAL IMPROVEMENT DISTRICT CREATED UNDER THE LAWS OF THE STATE OF IDAHO AGAINST LAND OWNED BY THE UNITED STATES WITHIN SUCH DISTRICT IS TO BE REGARDED AS AN INVOLUNTARY EXACTION AND, AS SUCH, CONSTITUTES A TAX WHICH THE UNITED STATES IS NOT REQUIRED TO PAY.

ACTING COMPTROLLER GENERAL YATES TO L. W. DARBY, DEPARTMENT OF AGRICULTURE, JULY 17, 1947:

REFERENCE IS MADE TO YOUR LETTER OF MAY 29, 1947 (A DISBURSEMENT VOUCHERS), SUBMITTING A VOUCHER TOGETHER WITH RELATED PAPERS, STATED IN FAVOR OF THE CITY OF BURLEY, IDAHO, IN THE AMOUNT OF $208.89 FOR ASSESSMENTS FOR STREET IMPROVEMENTS LEVIED AGAINST THE UNITED STATES AS OWNER OF LOT 14, BLOCK 164, BURTON'S FIRST ADDITION, CITY OF BURLEY, IDAHO, OCCUPIED BY THE FOREST SERVICE AS AN ADMINISTRATIVE SITE FOR THE MINIDOKA NATIONAL FOREST.

THE RECORD SHOWS THAT ON MAY 27, 1946, THE CITY COUNCIL OF BURLEY ADOPTED A RESOLUTION PROVIDING FOR THE CREATION OF A LOCAL IMPROVEMENT DISTRICT WITHIN THE CORPORATE CITY LIMITS AND THAT THE GOVERNMENT SITE HERE IN QUESTION IS WITHIN THE SAID IMPROVEMENT DISTRICT.

IN A STATEMENT BY THE ACTING FOREST SUPERVISOR ON THE REVERSE SIDE OF THE VOUCHER RECOMMENDING APPROVAL OF THE VOUCHER FOR PAYMENT IT IS STATED, AS FOLLOWS:

SOME 5 OR 6 YEARS AGO, A LIGHT OILED SURFACE WAS PLACED ON THE STREET WITH INSUFFICIENT BASE. THIS SURFACE HAS BROKEN UP CAUSING DIFFICULT AND DANGEROUS TRAVEL CONDITIONS DURING PERIODS OF WET WEATHER. THE GROUND IN THIS VICINITY IS EXTREMELY LEVEL MAKING IT DIFFICULT TO GET PROPER DRAINAGE. THESE STREET IMPROVEMENTS WILL REMEDY THIS SITUATION SINCE STORM SEWERS ARE BEING INSTALLED IN CONNECTION WITH THE CURB AND GUTTER PROJECT. DURING PERIODS OF DRY WEATHER THE DUST CONDITION WAS A MENACE TO SAFE TRAVEL ALONG THIS STREET, AND HAS A DAMAGING EFFECT ON THE EXTERIOR AND INTERIOR OF BUILDINGS AND LANDSCAPING. THE STREET IMPROVEMENT WORK WILL ELIMINATE THESE HAZARDS AND DAMAGING CONDITIONS.

TITLE TO THE BURLEY ADMINISTRATIVE SITE EXTENDS TO THE CENTER OF THE STREET. THE STREET IMPROVEMENT WORK CONSISTS OF: 1. REGARDING, REGRAVELING AND OILING. 2. CONSTRUCT, RECONSTRUCT, AND RENEW CURBS GUTTER ALONG EACH SIDE OF EVERY STREET WITHIN THE IMPROVEMENT DISTRICT ESTABLISHED. THE CITY OF BURLEY LET THE JOB OUT ON COMPETITIVE BID AND THE CONTRACT WAS AWARDED TO THE LOWEST BIDDER. IT IS TO THE ADVANTAGE OF THE GOVERNMENT TO REIMBURSE THE CITY ON A COST BASIS, RATHER THAN TO CONTRACT SEPARATELY FOR DOING THE JOB. YOU WILL OBSERVE FROM THE VOUCHER ITEMIZATION THAT THE PRICE PAID TO THE CITY IS LESS BY $26.11 THAN IT WOULD HAVE COST THE GOVERNMENT TO HIRE THIS CONTRACTOR TO DO THE JOB AT THE SAME RATES AS THOSE CHARGED THE CITY OF BURLEY. THESE RATES ARE THE CLOSEST OBTAINABLE.

IT IS A WELL SETTLED RULE THAT LANDS OWNED BY THE UNITED STATES CANNOT BE TAXED BY A STATE OR BY ANY OF THE POLITICAL SUBDIVISIONS OF A STATE. VAN BROCKLIN V. TENNESSEE, 117 U.S. 151; UNITED STATES V. POWER COUNTY, IDAHO, 21 F.1SUPP. 684; CF. PACIFIC SPRUCE CORP. V. LINCOLN COUNTY, 21 F.2D 586. THIS RULE APPLIES WITH EQUAL FORCE WHERE THE TAX IS A SPECIAL TAX OR ASSESSMENT FOR LOCAL IMPROVEMENTS AS WELL AS IN THE CASE OF A GENERAL PROPERTY TAX AGAINST LANDS OWNED BY THE UNITED STATES. LEE V. OSCEOLA AND LITTLE RIVER ROAD IMPROVEMENT DISTRICT, 268 U.S. 643; MULLEN BENEVOLENT CORPORATION V. UNITED STATES, 290 U.S. 89; UNITED STATES V. ANDERSON COTTONWOOD IRRIGATION DISTRICT, 19 F.1SUPP. 740; 18 COMP. GEN. 562. CF., ALSO, PEOPLE OF PUERTO RICO V. UNITED STATES, 134 F.2D 267. A SPECIAL ASSESSMENT IS A TAX WITHIN THE RULE PRECLUDING A STATE FROM TAXING LANDS OWNED BY THE UNITED STATES, BECAUSE IT IS AN INVOLUNTARY EXACTION. SEE UNITED STATES V. ANDERSON COTTONWOOD IRRIGATION DISTRICT, SUPRA; HAGAR V. RECLAMATION DISTRICT, 111 U.S. 701.

NOTWITHSTANDING THE VARIOUS THEORIES ADVANCED IN YOUR LETTER AS BEING FAVORABLE TO PAYMENT OF THE AMOUNT ON THE VOUCHER THE CONCLUSION IS REQUIRED THAT THE CLAIM PRESENTED IS ESSENTIALLY A DEMAND BY THE CITY OF BURLEY FOR THE PAYMENT OF AN ASSESSMENT FOR STREET IMPROVEMENTS AGAINST LAND OWNED BY THE UNITED STATES; AND, AS WAS STATED IN 18 COMP. GEN. 562, AN ASSESSMENT OF THAT TYPE "IS AN INVOLUNTARY EXACTION, AND AS SUCH IS A TAX WHICH THE UNITED STATES MAY NOT BE REQUIRED TO PAY.'

THE VARIOUS SECTIONS OF IDAHO STATUTES AUTHORIZING THE CREATION BY MUNICIPAL ACTION OF IMPROVEMENT DISTRICTS SUCH AS HERE INVOLVED FOR THE PURPOSE OF MAKING STREET IMPROVEMENTS AND OTHER SIMILAR PURPOSES ARE FOUND IN SECTIONS 49-2501 TO 49-2560 IDAHO CODE ANNOTATED, 1932, FORMERLY SECTIONS 3911-4151 IDAHO COMPILED STATUTES, 1919. THE FIRST STEP IS AN ORDINANCE DECLARING THE INTENTION TO CREATE THE IMPROVEMENT, DESCRIBING THE SECTION TO BE IMPROVED, ESTIMATING THE COST, AND DECLARING THAT THE COST IS TO BE ASSESSED AGAINST THE CONTIGUOUS PROPERTY. PROTESTS MAY BE MADE AND ARE TO BE HEARD AND CONSIDERED, AND THEREAFTER AN ORDNANCE IS PASSED CREATING THE DISTRICT AND PROVIDING FOR TAXATION AND ASSESSMENT OF THE COST UPON ALL PARCELS OF LAND WITHIN THE DISTRICT IN PROPORTION TO BENEFITS. ASSESSMENTS MADE TO PAY THE COST OF THE IMPROVEMENTS CONSTITUTE LIENS AGAINST THE PROPERTY ASSESSED.

THE EARLIER STATUTORY PROVISIONS CITED ABOVE WERE CONSIDERED BY THE SUPREME COURT OF THE UNITED STATES IN THE CASE OF MULLEN BENEVOLENT CORPORATION V. UNITED STATES, SUPRA. IN THAT CASE SUIT WAS BROUGHT UNDER THE TUCKER ACT, 24 STAT. 505, BY THE HOLDER OF IMPROVEMENT BONDS ISSUED BY A LOCAL IMPROVEMENT DISTRICT IN IDAHO TO FINANCE SIDEWALK AND SEWER CONSTRUCTION, AND IT WAS SOUGHT TO COLLECT THE BALANCE DUE ON THE BASIS OF A REASSESSMENT MADE AFTER CERTAIN OF THE PROPERTY BENEFITED HAD BEEN ACQUIRED BY THE UNITED STATES. THE SUPREME COURT OF THE UNITED STATES HELD THAT ASSESSMENTS OF A LOCAL DISTRICT, AN ADJUNCT OF AN INCORPORATED CITY SUCH AS THERE INVOLVED, FOR STREET IMPROVEMENTS WERE TAXES AND THAT THE GOVERNMENT WAS NOT LIABLE FOR ASSESSMENTS LEVIED AFTER IT ACQUIRED TITLE. IN DENYING THE CLAIM THE COURT STATED AT PAGE 91,"BUT AS THE LAND WAS THEN OWNED BY THE UNITED STATES, THE ASSESSMENT WAS A NULLITY. VAN BROCKLIN V. TENNESSEE, 117 U.S. 1.' IN A SIMILAR CASE IN 1925, LEE V. OSCEOLA AND LITTLE RIVER ROAD IMPROVEMENT DISTRICT, SUPRA, THIS IMMUNITY TO ASSESSMENT FOR LOCAL IMPROVEMENTS WAS EXTENDED TO ANNUL A REASSESSMENT MADE AFTER THE PROPERTY HAD BEEN CONVEYED BY THE UNITED STATES TO PRIVATE OWNERS, THE IMPROVEMENTS HAVING BEEN COMPLETED AND THE FIRST ASSESSMENT MADE WHILE THE LAND WAS OWNED BY THE UNITED STATES.

IN THE SITUATION INVOLVED IN B-22714, MARCH 19, 1942, REFERRED TO IN YOUR LETTER, CONSTRUCTION OF THE SEWER WITH THE PRIVILEGE TO THE GOVERNMENT OF CONNECTING TO IT WAS IN PRACTICAL EFFECT A SPECIFIC SERVICE NECESSARY TO THE USE, OCCUPATION AND OPERATION OF THE BUILDINGS THERE INVOLVED. WHILE IN THE PRESENT CASE AN IMPROVED ROAD MAY BE MORE DESIRABLE THAN THE OLD ROAD, YET ITS CONSTRUCTION WAS NOT NECESSARY TO THE GOVERNMENT'S CONTINUED USE AND OCCUPANCY OF THE ADJACENT PROPERTY. HENCE, THE ASSESSMENT MADE IN THE PRESENT CASE CANNOT BE VIEWED AS A CLAIM FOR A SERVICE SUCH AS INVOLVED IN THE SAID DECISION OF MARCH 19, 1942.

ACCORDINGLY, CERTIFICATION OF THE VOUCHER IS NOT AUTHORIZED.