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AGO 1961 No. 40 - June 22, 1961
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John J. O'Connell | 1957-1968 | Attorney General of Washington

PENSION ‑- FIREMEN ‑- USE OF MILLAGE LEVY FOR MUNICIPAL PURPOSES OTHER THAN PENSION FUND

Under the provisions of § 9, chapter 255, Laws of 1961, if after an examination of and report on the condition of the firemen's pension fund by an actuary, it is determined that the condition of the fund is such as not to require all or part of the millage levy therein provided for, such millage may be levied and used for another municipal purpose.

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                                                                   June 22, 1961

Honorable Donald H. Webster
Director, Bureau of Governmental
Research and Services
266 J. Allen Smith Hall
University of Washington
Seattle 5, Washington

                                                                                                                Cite as:  AGO 61-62 No. 40

Dear Sir:

            By letter previously acknowledged, you have requested an opinion of this office on a question which we paraphrase as follows:

            Under the provisions of § 9, chapter 255, Laws of 1961, if, after an examination of and report on the condition of the firemen's pension fund by an actuary, it is determined that the condition of the fund is such as not to require all or part of the millage levy therein provided for, may such millage nevertheless be levied and used for another municipal purpose?

            We answer your question in the affirmative, for the reasons set forth in our analysis.

                                                                     ANALYSIS

            Section 9, chapter 255, Laws of 1961, relates to a real property tax to be levied by municipalities primarily as a part of the funding structure of the salaried municipal firemen's relief and pension system.  The immediately preceding section of the same chapter, amending § 5, chapter 91, Laws of 1947 (as amended, cf. RCW 41.16.050) establishes in the treasury of each municipality,

             [[Orig. Op. Page 2]]

            ". . . a fund which shall be known and designated as the firemen's pension fund, which shall consist of (1) all bequests, fees, gifts, emoluments or donations given or paid thereto, (2) forty-five percent of all moneys received by the state from taxes on fire insurance premiums, (3)taxes paid pursuant to the provisions of RCW 41.16.060, (4) interest on the investments of the fund, (5) contributions by firemen as provided for herein. . . ." (Emphasis supplied.)

            Section 9, with which we are immediately concerned (to be codified as RCW 41.16.060) provides as follows:

            "It shall be the duty of the legislative authority of each municipality, each year as a part of its annual tax levy, to levy and place in the fund a tax of one mill on all the taxable property of such municipality:  Provided, That should the estimated amount to be raised by said levy of one mill, together with other estimated income be insufficient to meet the estimated requirements of the fund then there shall be levied such additional tax, not to exceed one mill, as will meet said requirements:  Provided further, That this additional levy may be in addition to the city fifteen mill levy limit now provided by law.

            "Any city or town may, at any time before the annual budget for the city or town is made, cause an examination of and report on the condition of the firemen's pension fund by an actuary, and if it is established from such examination and report that the condition of the fund and the estimated demands and requirements thereon under this chapter during the ensuing budget year will not require the levy of the mandatory one mill, or if all or any part of the additional one mill levy is unnecessary to meet the estimated demands on the fund under this chapter for the ensuing budget year, the levy of the mandatory or additional one mill may be omitted,or the whole or any part of such millage may be levied and used for any other municipal purpose."  (Emphasis supplied.)

            This section is identical to § 1, chapter 72, Laws of 1951.  As originally introduced into the legislature at its 1961 regular session, § 9 (being then § 9 of House Bill 365, 1961 legislative session) was so written as to change the language, by express amendment, of the earlier law.  However, by a floor amendment in the Senate, the amendatory  [[Orig. Op. Page 3]] language of this section of the bill was deleted and the section rewritten so as to coincide precisely with the earlier law which it had been designed to amend.

            This earlier law, (§ 1, chapter 72, Laws of 1951) has previously been construed by this office on several occasions.  Particularly to be noted are AGO 51-53 No. 58, dated May 28, 1951, to the Honorable Cliff Yelle, State Auditor; and AGO 51-53 No. 146, dated October 2, 1951, to the Honorable John Panesko, Lewis County Prosecuting Attorney, copies of which are herein enclosed.  Basically the question posed in each of these opinions was the same as that which you have here posed; namely, whether, in the event that either the "mandatory" one mill or the "additional" one mill to be levied for the benefit of the firemen's pension fund were determined to be unnecessary for that purpose in a given year, this millage could nevertheless be levied for other municipal purposes.  This question was not answered in either opinion, with regard to either the "mandatory" one mill or the "additional" one mill.  In the first opinion (AGO 51-53 No. 58) the writer thereof apparently reasoned that a situation calling for an answer for so much of the question as related to the "additional" one mill could never arise because "there would never be any determination that the additional mill or any part thereof, was not necessary" for pension fund purposes.  The writer of the second opinion (AGO 51-53 No. 146), while concluding that a city may levy a total of 16 mills (i.e., one "additional" mill over the statutory ‑ RCW 84.52.050 ‑ 15 mill limit on city tax levies) where required to finance the pension fund, also declined to answer as to whether, specifically, the "additional" one mill could be levied for other municipal purposes if determined not to be necessary for the pension fund.  This latter writer's reasoning was that this "additional" mill could only be levied "when necessary to meet the estimated requirements of the firemen's pension fund," and therefore "the question of the use of the additional one mill for other than those purposes would not arise."

            Further, in each of these opinions the respective writers thereof not only expressly declined to answer so much of questions posed as related to the "additional" one mill, they also apparently simply ignored the matter of use of the "mandatory" one mill for other municipal purposes in the event of a determination that said "mandatory" one mill was unnecessary for purposes of the pension fund.

            We are not now inclined to so treat either facet of the question.  It is quite evident, notwithstanding the reasoning of either of the writers of the two prior opinions to which we have referred, (1) that a determination might be made that either or both of the "mandatory" one mill and the "additional" one mill are not necessary for pension fund purposes for a particular year, and (2) that such a determination would  [[Orig. Op. Page 4]] then require an answer to the question of whether this millage might nevertheless be levied for other municipal purposes.

            Under § 9, chapter 255, Laws of 1961, supra, a levy of one mill must be made by each municipality having a firemen's pension fund, unless, based upon an actuarial report, such levy is established to be unnecessary for a particular year.  Cf. AGO 51-53 No. 518, a copy of which is enclosed.  In addition, ". . . should the estimated amount to be raised by said levy of one mill, together with other estimated income be insufficient to meet the estimated requirements of the fund then there shall be levied such additional tax, not to exceed one mill, as will meet said requirements: . . ." (Emphasis supplied.) In other words, the so-called "additional" one mill is also a mandatory levy where a necessity on the part of the pension fund exists. See AGO 55-57 No. 119 [[to Prosecuting Attorney, Spokane County on July 25, 1955]], a copy of which is enclosed.

            Obviously, then, if from an actuarial report it is established that the "mandatory" one mill isnot necessary for pension fund purposes for a particular year, the question would then arise as to whether this millage might nevertheless be levied for other municipal purposes.  Further, such a determination would manifestly also constitute a determination that the "additional" one mill is unnecessary for pension fund purposes for the year in question, calling then for an answer as to whether this "additional" one mill might be levied for other municipal purposes.  And finally, the same question relative to the "additional" mill could also arise where, from the municipality's own estimates, it is determined that the "mandatory" mill, though necessary, will be sufficient for pension fund purposes for a particular year.

            Assuming then that a determination is in fact made that either or both the "mandatory" mill or the "additional" mill is unnecessary for pension fund purposes for a particular year how should the question of whether this millage may nevertheless be levied for other municipal purposes be answered?  On this point we believe that the statute here under consideration is plain, clear, and unambiguous.  In essence it provides that if either or both the "mandatory" mill or the "additional" mill is determined to be unnecessary for pension fund purposes for a particular year, then, ". . . the levy of the mandatory or additional one mill may be omitted, or the whole or any part of such millage may be levied and used for any other municipal purpose."  (Emphasis supplied.)

            In other words, upon a determination that either or both of these millages are unnecessary for pension fund purposes for a particular year, the municipality in question has the alternative of either omitting the levying the whole or any part of the millage, or of levying the whole or any part of same to be used for other municipal purposes.

             [[Orig. Op. Page 5]]

            This we believe to be true even though, in the case of cities and towns, the effect of this conclusion is to say that under appropriate circumstances a city or town may make a levy, not only for pension fund purposes, but (where not necessary for pension fund purposes) for other municipal purposes, in excess of the 15 mill limit set by RCW 84.52.050, supra.  The statute itself expressly provides that the "additional" one mill levy "may be in addition to the city 15 mill levy limit now provided by law."  "Law" in this case is simply an earlier enacted statute; namely, RCW 84.52.050, supra.  See AGO 51-53 No. 146,supra.  To the extent that this latter opinion suggests that the "additional" one mill, over and above the statutory 15 mill limit, may only be levied where necessary for pension fund purposes, this opinion is hereby expressly overruled.  The thought implicit in this prior opinion was that the "additional" mill was onlyauthorized where necessary for pension fund purposes.  However, as was pointed out in AGO 55-57 No. 119, supra, a necessity for pension fund purposes does not merely give rise to authority to levy the "additional" one mill; it makes such a levy mandatory.  Absent necessity, the "additional" one mill is nevertheless authorized, in our opinion, if the municipality in question elects to make the levy for other municipal purposes rather than omitting it.  See again our earlier discussion of this point, above.

            We trust that the foregoing will be of assistance to you.

Very truly yours,

JOHN J. O'CONNELL
Attorney General

PHILIP H. AUSTIN
Assistant Attorney General

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