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AGLO 1971 No. 23 - Feb 8 1971
Attorney General Slade Gorton

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                                                                February 10, 1971
Honorable Dale E. Hoggins
State Representative, 21st District
House Office Building
Olympia, Washington 98501
                                                                                            Cite as:  AGLO 1971 No. 23 (not official)
Dear Sir:
            You have requested our advice upon certain questions which we paraphrase as follows:
            Is the Urban Arterial Board required to hold public hearings upon proposed urban arterial projects and if so, does chapter 34.04 RCW (the Administrative Procedure Act) require the Board to accept testimony from an individual at such a hearing?
            The 1967 legislature enacted chapter 83 creating the Urban Arterial Board and providing for the urban arterial construction program.  Funds derived from motor vehicle fuel taxes and the sale of bonds financed by such taxes were made available to the Urban Arterial Board for allocation to cities and counties for construction of arterials within the urban areas of the state.  The Board was authorized to allocate urban arterial trust funds to counties and cities based upon a priority rating using criteria established by statute.  All projects, however, are initiated by counties and cities which in effect request financial assistance from the urban arterial trust account in a manner which permits the Board to evaluate the priority of each project in relation to all other projects within the same class.
            Accordingly, it must be emphasized that no urban arterial project is initiated, planned or constructed by the Urban Arterial Board.  All urban arterial projects are county and city projects.  Except for the manner of financing and the fact that a project must meet prescribed standards established by rule of the Urban Arterial Board, each road and street construction project is the responsibility of the county or city in which it is located.
             [[Orig. Op. Page 2]]
            There is no provision in the Urban Arterial Board statute for the holding of public hearings incident to the priority rating of construction projects submitted by the counties and cities or the actual allocation of urban arterial trust account funds for construction of urban arterial projects.
            The Urban Arterial Board is a state board and as such is subject to the provisions of chapter 34.04 RCW, the Administrative Procedure Act.  The Administrative Procedure Act provides for two types of hearings.  Prior to the adoption of any rule, each agency must give at least twenty days notice of its intended action and afford interested persons an opportunity to submit data either orally or in writing and in case of a substantive rule must afford an opportunity for an oral hearing if requested by twenty-five persons, a governmental subdivision or agency or an association having not less than twenty-five members.  RCW 34.04.055
            In addition, the act requires that in any contested case all parties shall be afforded an opportunity for a hearing after not less than twenty days notice.  RCW 34.04.090.
            The Urban Arterial Board has adopted rules for the implementation of the provisions of the statute relating to the allocation of funds in the urban arterial trust account to counties and cities.  These rules were adopted in the manner prescribed by the Administrative Procedure Act.  However, these are general rules falling within the definition contained in RCW 34.04.010 wherein the word is defined as follows:
            (2) "Rule" means any agency order, directive or regulation of general applicability (a) the violation of which subjects a person to a penalty or administrative sanction; (b) which establishes, alters or revokes any procedure, practice or requirement relating to agency hearings; (c) which establishes, alters or revokes any qualification or requirement relating to the enjoyment of benefits or privileges conferred by law; (d) which establishes, alters or revokes any qualifications or standards for the issuance, suspension or revocation of licenses to pursue any commercial activity, trade or profession; or (e) which establishes, alters or revokes any mandatory standards for any product or material which must be met before distribution or sale.  The term includes the amendment or repeal of a prior rule, but does not include (i) statements concerning only the internal management of an agency and not affecting private rights or procedures available to the public, (ii) declaratory rulings issued pursuant to RCW 34.04.080, as  [[Orig. Op. Page 3]] now or hereafter amended, or (iii) speed restrictions for motor vehicles established by the state highway commission. * * *
            It will be noted that as defined in the above statute "rule" relates to a regulation "of general applicability".  Thus, the general rules adopted by the Board for implementing the statute were adopted pursuant to the procedure set out in the Administrative Procedure Act.  By contrast, the actual priority rating of urban arterial projects and the allocation of funds to cities and counties is not rule making falling within the provisions of the Administrative Procedure Act.  Accordingly, the procedures prescribed for the adoption of rules including notice and opportunity to submit data orally or in writing do not apply to the administrative actions of the Urban Arterial Board in approving projects for trust account funding.
            The priority rating of urban arterial projects and allocation of funds to those projects do not involve the Board in a "contested case" as defined by the Administrative Procedure Act.  The definition found in RCW 34.04.010 is as follows:
            (3) "Contested case" means a proceeding before an agency in which an opportunity for a hearing before such agency is required by law or constitutional right prior or subsequent to the determination by the agency of the legal rights, duties, or privileges of specific parties.  Contested cases shall also include all cases of licensing and rate making in which an application for a license or rate change is denied except as limited by RCW 66.08.150, or a license is revoked, suspended, or modified, or in which the granting of an application is contested by a person having standing to contest under the law or agency rules.
            As noted above, the urban arterial statute does not provide for hearings in connection with the selection of projects and allocation of funds.  Moreover, there is no constitutional right to such a hearing.  Those potentially affected by the Board's decision as to which projects shall receive assistance may be divided into two categories.  One is comprised of the municipal agencies submitting proposed projects to the Board.  The legislature has created a source of funds for such assistance and delegated to the Board the complicated task of disbursing the funds among the eligible municipal agencies, subject to the  [[Orig. Op. Page 4]] standards and directions set forth in chapter 47.28 RCW.  In Adams v. Ernst, 1 Wn.2d 254, 265, 95 P.2d 799 (1939), the court held that a right becomes vested
            ". . . when the right to enjoyment, present or prospective, has become the property of some particular person or persons as a present interest."
            Accordingly, a municipal agency has no vested right to assistance from the trust account for any particular project upon submission of its project array for consideration.  Since the Board's selection of projects to be funded does not interfere with a vested property right of the municipal agency, the agency is not entitled to a constitutional right to a hearing.  Senior Citizens League, Inc., et al. v. Department of Social Security, 38 Wn.2d 142, 228 P.2d 478 (1951).
            Furthermore, when the municipal agency presents its proposal to the Board, it has no interest which is superior to the interests of other agencies which are also submitting projects for consideration.  Such a common interest with other agencies does not create a right which properly underlies a "contested case" as illustrated by the case of Town of Ashwaubenon v. State Highway Commission, 17 Wis. 2nd 120, 115 N.W.2d 498 (1962) which involved a similar relationship.  There a town felt aggrieved because a proposed highway was relocated further away from that town and then through another town without the benefit of a hearing conducted as a "contested case" by the administrative agency delegated the task of making such decisions.  The town alleged that it was entitled to a hearing so conducted under a statute which contained a definition of the term "contested case" which is very close to that contained in RCW 34.04.010.  The court held that such administrative action was not the proper subject of a contested case saying:
            "While it is arguable that 'the legal rights, duties or privileges' of the Town of Ashwaubenon are involved in the relocation of the arterial highway, we consider that such relocation will inevitably affect the rights of everyone in proximity to the new and the old locations, as well as the public at large.  The Town of Ashwaubenon had only the same interest in the proposed relocation as any other affected municipality or landowner; it did not have any special kind of interest which would convert the proceedings before the highway commission into a contested case.
             [[Orig. Op. Page 5]]
            "When the legislature defined a contested case . . . it contemplated some special interest . . ."
            Town of Ashwaubenon v. State Highway Commission, supra, at 502.
            While the town was certainly affected by the proposed relocation and new construction of the arterial highway, the effect differed only in degree from the effect of the decision upon the other town, and the public generally.  The same is true of the decisions by the Board as to which projects to assist.  Moreover, the Board's action has far less direct and certain affect than the decision in the cited case because a municipal agency may construct proposed project, or choose not to construct it, irrespective of the Board's decision to assist in funding.
            The other group which may be affected by the Board's decision would be the individual property owners whose property is located in proximity to the proposed projects under consideration.  However, since the Board's determination does not deprive these individuals of a vested right, they are not constitutionally entitled to a hearing before the Board.  As previously stated, the Adams case, supra, defines a vested right as an immediate fixed right of present or future enjoyment.  When the Board selects a project for funding the property owners adjacent to the proposed projects are not deprived of any fixed right.  They are in the same position they were in prior to the decision.  Subsequently, if the municipal agency does decide to construct the project, any property owner whose property rights will be taken or damaged has the right to a judicial hearing to determine if the taking is proper and, if so, the amount of compensation he should receive for his loss.  Article I, § 16 Washington Constitution; RCW 8.08.040; RCW 8.12.070.  However, none of his property rights are taken or damaged until that point in time.  As stated in Senior Citizens League Inc. v. Dept. of Social Security, supra, at page 168, procedural due process is not required ". . . where there is no interference with life, liberty, or a vested property right."  Since this interference does not occur until property is appropriated or damaged by the municipal agency, the abutting owner has no constitutional right to a hearing prior to this juncture.
            As reflected in Town of Ashwaubenon v. State Highway Commission, supra, the decision to locate an arterial does not affect the special interests of any particular individual to the degree that he would be entitled to a hearing on the matter.  The Board's determination to accord financial assistance to a municipal agency is likewise part of the preliminary planning  [[Orig. Op. Page 6]] for the project which affects the public in general as opposed to the interests of specific individuals.  As a consequence, abutting property owners have no constitutional right to appear before the Board on the issue of funding proposed urban arterial projects.
            From the above it may be seen that neither cities and counties nor individuals are afforded hearings as a matter of right before the Urban Arterial Board.  It must be emphasized, however, that state law declares that all meetings, regular and special, of any board or other agency are to be public meetings open to the public at all times.  RCW 42.32.020.  Accordingly, both representatives of cities and counties and concerned individuals have a statutory right to attend the regular and special meetings of the Urban Arterial Board.  The Board, in its discretion, may as a courtesy hear statements of persons present in connection with proposed actions before the Board.  In doing so, the Board, however, would not be conducting a hearing as such.  At this time the Board has not adopted any rule providing for hearings.
            In conclusion, the recourse of individuals who may feel they are adversely affected by the construction of a urban arterial project is primarily to their own city or county government which has initiated and planned the project and will ultimately construct it.  Thus, such an individual may personally contact the elected officials of the city or county and may appear and be heard at city council meetings or county commissioner meetings.  Our State Constitution assures every property owner a judicial hearing and just compensation before his private property is taken or damaged for public purposes by the county or municipality.  Art. I § 16.
            The limited though important function of the Urban Arterial Board is to establish the priorty rating of urban arterial projects using criteria established by the legislature and to allocate state collected funds in accordance with such ratings.  In performing this function the Board is not required by law to conduct public hearings.
Very truly yours,
Assistant Attorney General
Assistant Attorney General