OFFICES AND OFFICERS - STATE - WHEAT COMMISSION - LIABILITY OF STATE FOR ASSESSMENT FOR WHEAT GROWN ON PUBLIC AND SCHOOL LANDS.
The State of Washington is not subject to the assessment provided for by the Washington Agricultural Enabling Act and Marketing Order for wheat grown on public and school lands leased to farmers on a share crop basis.
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September 8, 1959
Washington State Wheat Commission
409 Empire State Building
Spokane, Washington Cite as: AGO 59-60 No. 64
You have requested an opinion on a question which we paraphrase as follows:
Is the State of Washington subject to the assessment provided for by the Washington Agricultural Enabling Act and Marketing Order for Washington Wheat dated December 4, 1957, for wheat grown on public and school lands leased to farmers on a share crop basis?
We answer your question in the negative.
The Washington Agricultural Enabling Act is contained in chapter 15.66 RCW. Its purpose is set forth in RCW 15.66.020 as follows:
"The marketing of agricultural products within this state is affected with a public interest. It is declared to be the policy and purpose of this chapter to promote the general welfare of the state by enabling producers of agricultural commodities to help themselves in establishing orderly, fair, sound, efficient and unhampered marketing, grading and standardizing [[Orig. Op. Page 2]] of the commodities they produce, and in promoting and increasing the sale of such commodities."
The act further provides that the State Director of Agriculture may make marketing orders which shall among other things establish commodity commissions. RCW 15.66.030. The Marketing Order for Washington Wheat of December 4, 1957, was promulgated under authority of the act and does not differ from the statute in any respect material to this discussion. The objectives of the order are as set forth in the language of RCW 15.66.030, and a Wheat Commission was established. RCW 15.66.150 makes provision for annual assessments:
"There is hereby levied, and there shall be collected by each commission, upon each and every unit of any agricultural commodity specified in any marketing order an annual assessment which shall be paid by the producer thereof upon each and every such unit sold, processed, stored or delivered for sale, processing or storage by him. Such assessments shall be expressed as a stated amount of money per unit. The total amount of such annual assessment to be paid by all affected producers of such commodity shall not exceed:
"(1) In the case of wheat, one half cent per bushel; . . ."
As the assessments are to be paid by the "producer" of the crop it becomes necessary to determine if the State of Washington is a "producer" within the meaning of the act. RCW 15.66.010 reads in part:
"For the purposes of this chapter:
". . .
"(5) 'Producer' means any person engaged in the business of producing or causing to be produced for market in commercial quantities any agricultural commodity.
". . .
"(11) 'Person' includes any individual, firm, corporation, trust, association, partnership, [[Orig. Op. Page 3]] society, or any other organization of individuals."
Assuming, that by its landlord status, the state is engaged in the business of producing or causing to be produced wheat for market, is it a "person" so engaged within the statutory definition?
InJenks v. State, 188 Wash. 472, 475, 63 P. (2d) 369, the court said:
". . . In this connection, the general rule is invoked to the effect that the state is not bound by the provisions of the general statute where the effect of such statute would be to restrict the rights of the state, to affect its interests, or to impose liabilities upon it, unless it is named expressly or by necessary implication. . . ."
This rule was recognized by the court in the following later cases: State ex rel. Thielicke v. Superior Court, 9 Wn. (2d) 309, 114 P. (2d) 1001; West Norman Timber, Inc. v. State, 37 Wn. (2d) 467, 224 P. (2d) 635;Port of Seattle v. Inter. etc. Union, 52 Wn. (2d) 317, 324 P. (2d) 1099.
Not being expressly included within the definition of "person" contained in the act, is the state to be included by necessary implication? In answering this question the purpose and subject matter of the statute, and the context in which the term "person" is used, together with other factors, may be considered. General Cas. Co. v. Seattle etc. Bk., 42 Wn. (2d) 433, 256 P. (2d) 287. The act would, if applied to the state, clearly restrict its rights, affect its interests and impose liabilities upon it.
The purpose of the act is set out in RCW 15.66.020, supra.
RCW 15.66.030 reads as follows:
"Marketing orders may be made for any one or more of the following purposes:
"(1) To establish plans and conduct programs for advertising and sales promotion, to maintain present markets or to create new or larger markets for any agricultural commodity grown in the State of Washington;
"(2) To provide for carrying on research [[Orig. Op. Page 4]] studies to find more efficient methods of production, processing, handling and marketing of any agricultural commodity;
"(3) To provide for improving standards and grades by defining, establishing and providing labeling requirements with respect to the same;
"(4) To investigate and take necessary action to prevent unfair trade practices."
All moneys collected by the assessments on producers are to be used solely for payment of the costs and expenses incurred in carrying out the purposes of the marketing order. RCW 15.66.160.
In 3 Sutherland, Statutory Construction (3rd ed.) 191, § 6303, it is said that the above quoted rule should be relaxed and the state included in a general statute if the statutory objective could not be accomplished without its inclusion, or if its inclusion would not vitally interfere with the processes of government. There is nothing in the context of the Agricultural Enabling Act to indicate that its objectives will fail if the state is not assessed. Assessments paid by the many private wheat producers will provide revenue to carry out the purposes of the law without assessing the state's share of the crop. Of course, lessees of state lands engaged in the business of producing for market will be "producers" and thus liable for assessments upon each bushel of wheat they sell, process, store or deliver for sale, processing or storage.
Assessing the state will interfere with the process of government in that restrictions will be placed upon the disposition of the crops and diminish the income from state lands. All such lands are held in trust for the public and a substantial part of the lands leased by the state on a share crop basis are school lands and held by the state in its governmental capacity. State v. Northwest Magnesite Co., 28 Wn. (2d) 1, 182 P. (2d) 643. Any assessment payable by the state upon the proceeds therefrom, interferes with a governmental process.
In addition, there is no procedure set out in the act for the payment of these assessments by the state which is indicative of the legislative intent that the state be subject to such assessment. Chapter 79.44 RCW contains express provisions for assessments against public lands in certain cases, but a method and means of payment by the state is specifically provided.
Although the term "assessment" is used in the statute to designate [[Orig. Op. Page 5]] the levy of one half cent per bushel of wheat, the levy imposed is in the nature of a tax. It cannot be supposed that the legislature would ever impose general taxes upon state lands unless they were unmistakably included in the statute. 2 Cooley Taxation (4th ed.) § 621. This rule applies to different types of taxes and assessments. A city may not subject state lands to a special assessment for local improvements without express statutory authority. Spokane v. Security Savings Society, 46 Wash. 150, 89 Pac. 466.
We conclude, therefore, that the State of Washington is not liable for assessments on wheat imposed under the Agricultural Enabling Act because it is not expressly or by necessary implication included within the terms of the act.
Very truly yours,
JOHN J. O'CONNELL
HENRY W. WAGER
Assistant Attorney General