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AGLO 1972 No. 44 -
Attorney General Slade Gorton

                                                                 - - - - - - - - - - - - -

                                                                   May 31, 1972

Honorable Frank Foley
State Senator, 49th District
3924 Wauna Vista Drive
Vancouver, Washington 98661                                                                                            Cite as:  AGLO 1972 No. 44 (not official)

Dear Senator Foley:
            By letter dated May 26, 1972, you have requested the opinion of this office as to whether or not a housing authority may donate its funds to a city within the area of the housing authority's operation, to aid certain of that city's urban renewal projects to be undertaken pursuant to chapter 35.81 RCW.
            Under the plan, the city council proposes to make certain findings by resolution under the urban renewal law, specifically, RCW 35.81.050, that certain parts of the city are "blighted areas."  The resolution would make the further required finding that the rehabilitation and/or redevelopment of such areas is necessary, and the city would comply with all other procedural requirements of the urban renewal law.  The housing authority, if authorized by law, would agree to donate funds to the city in aid of the following urban renewal projects:
            (1) A study and plan for redevelopment of the core area of the downtown;
            (2) A code enforcement program for certain neighborhoods, consisting of the demolition and/or reconstruction of substandard low-income housing;
            (3) A neighborhood development program for one or several neighborhoods which would involve the demolition and/or construction or reconstruction of low-income housing and connected recreational facilities;
            (4) A plan for development of community center facilities for certain neighborhoods, including two of those contemplated in paragraph (3), in connection with existing or planned housing projects.
             [[Orig. Op. Page 2]]
            In our opinion a housing authority has the power to donate funds to a city for each of the purposes described in your letter, under the conditions set forth therein.
            In explaining the reasons for our answer, we first point out that Article VIII, § 7 of the Washington state Constitution presents no barrier to the proposal.  The prohibition of that section against gifts of municipal funds or credit does not apply to transactions wherein the donee or borrower is a municipal corporation.  Rands v. Clarke County, 79 Wash. 152, 139 Pac. 1090 (1914).  Consequently, the question depends entirely upon the extent of a housing authority's statutory powers.  As in all such questions, the basic rule to remember is that a municipal corporation or political subdivision has only the powers expressly granted to it by statute, and those which are necessarily implied from the powers expressly granted.  Pacific Etc. Ass'n v. Pierce County, 27 Wn.2d 347, 178 P.2d 351 (1947).
            The general nature and powers of a housing authority are found in chapter 35.82 RCW, and they are discussed in our informal opinion to you dated October 30, 1968 [[to Frank Foley, State Senator]].  A copy of that opinion is enclosed for ease of reference.  None of the provisions of that chapter or of the closely related chapter 35.83 RCW (the housing cooperation law) appear to authorize a housing authority to donate its funds to a city, although there is ample authority in this latter chapter whereby a city or another housing authority may donate funds to a housing authority.  See, particularly, RCW 35.83.030 and 35.83.050.  However, an examination of the urban renewal law itself, chapter 35.81 RCW, which also bears an obvious relationship to chapters 35.82 and 35.83 RCW, discloses ample authority, in our opinion, for the donation of funds by a housing authority to a city for the purposes described in your letter.
            The purposes of the urban renewal law are described in the title of its original enactment, chapter 42, Laws of 1957, as follows:
            "AN ACT to provide for the rehabilitation, redevelopment, and clearance of blighted areas in cities and towns in this state in accordance with urban renewal plans approved by the governing bodies thereof; to define the duties, liabilities, exemptions and powers of such cities and towns in undertaking such activities, including the power to acquire property through the exercise of the power of eminent domain or otherwise, to dispose of property subject to any restrictions deemed  [[Orig. Op. Page 3]] necessary to prevent the development or spread of future deteriorated or blighted areas, to issue revenue bonds and other obligations, to levy taxes and assessments and to enter into agreements to secure federal aid and comply with conditions imposed in connection therewith; to provide for an urban renewal agency and its powers hereunder if a city or town determines it to be in the public interest; to authorize public bodies to furnish funds, services, facilities and property in aid of urban renewal projects hereunder; and to provide that properties while held by a public agency hereunder shall be exempt from taxation."
            The term "urban renewal project" as used in that chapter, is defined in RCW 35.81.010 (18) as follows:
            "'Urban renewal project' may include undertakings or activities of a municipality in an urban renewal area for the elimination and for the prevention of the development or spread of blight, and may involve redevelopment in an urban renewal area, or rehabilitation in an urban renewal area, or any combination or part thereof in accordance with an urban renewal plan."
            The terms "redevelopment" and "rehabilitation" are further broadly defined in subsections (14) and (15) to include the acquisition of blighted areas, the demolition and removal of structures, installation of streets, utilities and other facilities, the repair and rehabilitation of structures, the construction of parks, playgrounds and other improvements, and similar purposes.
            RCW 35.81.050 and 35.81.060 prescribe certain procedural requirements for the approval and implementation of the urban renewal project.  Among those requirements are the preliminary findings described in your letter as to (1) the existence of blight, and (2) public necessity.
            Finally, RCW 35.81.070 empowers every municipality (which term is defined in RCW 35.81.010 (8) to mean an incorporated city or town), after completing the required procedural steps, to exercise ". . . all the powers necessary or convenient to carry out and effectuate the purposes and provisions of this chapter . . ." including but not limited to certain specific powers.
             [[Orig. Op. Page 4]]
            The final and most essential provision of the urban renewal law, insofar as your question is concerned, is RCW 35.81.130, providing in pertinent part as follows:
            "(1) For the purpose of aiding in the planning, undertaking, or carrying out of an urban renewal project located within the area in which it is authorized to act, any public body authorized by law or by this chapter, may, upon such terms, with or without consideration, as it may determine:  (a) Dedicate, sell, convey, or lease any of its interest in any property, or grant easements, licenses, or other rights or privileges therein to a municipality; (b) incur the entire expense of any public improvements made by such public body, in exercising the powers granted in this section; (c) do any and all things necessary to aid or cooperate in the planning or carrying out of an urban renewal plan; (d) lend, grant, or contribute funds to a municipality; (e) enter into agreements (which may extend over any period, notwithstanding any provision or rule of law to the contrary) with a municipality or other public body respecting action to be taken pursuant to any of the powers granted by this chapter, including the furnishing of funds or other assistance in connection with an urban renewal project, and (f) cause public building and public facilities, including parks, playgrounds, recreational, community, educational, water, sewer, or drainage facilities, or any other works which it is otherwise empowered to undertake to be furnished; furnish, dedicate, close, vacate, pave, install, grade, regrade, plan, or replan streets, roads, sidewalks, ways, or other places; plan or replan, zone or rezone any part of the urban renewal area; and provide such administrative and other services as may be deemed requisite to the efficient exercise of the powers herein granted.
            "(2) . . ."
            RCW 35.81.010, supra, subsection (11), defines the term "public body" to include:
            ". . . the state or any municipality, township, board, commission, district, or any other subdivision or public body of the state."
             [[Orig. Op. Page 5]]
            A housing authority is clearly a "public body" within the meaning of that statute.  See the enclosed copy of our opinion to Representative Kopet dated May 2, 1968, and authorities cited therein.
            Thus, the only problem we find in RCW 35.81.130, supra, is that of interpreting the phrase ". . . any public body authorized by law or by this chapter . . ."  (Emphasis supplied) as it appears therein.  There seem to be several alternative meanings to that phrase, rendering it ambiguous.
            We reject immediately any possible construction which would mean that only public agencies which possess full authority to do so under some other statute may donate funds for the objects specified in RCW 35.81.130.  Such a construction would make the statute unnecessary and meaningless, and in construing statutes we are constrained to avoid such absurd results whenever possible.  See, Trudeau v. Pac. States B. & B. Co., 20 Wn.2d 561, 148 P.2d 453 (1944); Lenci v. Seattle, 63 Wn.2d 664, 388 P.2d 926 (1964).  There are two remaining possible alternatives which we must, therefore, consider.  In our opinion, the phrase in question must mean either (1) "any other public body authorized by law or by this chapter to act within the same area," or (2) "any other public body, to the extent such other body is also authorized to engaged in the described type of activity."
            The first and broadest of these alternative constructions is probably the correct one.  In support of it one would argue that the very title of the urban renewal chapter, quoted earlier in this opinion, indicates as one of its purposes that of authorizing public bodies, without any particular limitation, to furnish assistance in aid of urban renewal projects.  Furthermore, RCW 35.81.160 authorizes a city, once having made the requisite findings and determinations, to assign its urban renewal powers in toto to ". . . any existing public body corporate . . .".  However, it is unnecessary to decide at this time which alternative is correct for under either construction, the housing authority would have the power to donate funds for the specific purposes in question.  Even under alternative construction (2), assuming that the city has completed all required procedural steps, the only remaining caveat that the housing authority must observe would be to condition the use of its granted funds strictly for those types of urban renewal projects which a housing authority could legally accomplish under its own statutory powers.  In this instance each of the four activities for which funds would be granted possesses that nature, if it is required.  As to the first purpose, a housing authority has the expressly granted legal power to ". . . make studies and recommendations . . ." relating to the various problems within its scope of authorization.  Thus, an urban renewal  [[Orig. Op. Page 6]] plan embracing the three further urban renewal activities which are the subject of this opinion would clearly fall within the statutory powers of a housing authority to make.1/   Those three further activities, as well as the city's plan, clearly fall within both the definition of "urban renewal" in RCW 35.81.010, supra, and the scope of the housing authority's powers as outlined in our previous opinion to you dated October 30, 1968, supra.
            In summary, it is our opinion that even under a strict construction of RCW 35.81.130, supra, a housing authority has the legal power to donate funds to a city within its area of operation for any or all of the four purposes described in your letter.  Our reasoning, stated in syllogistic form, is as follows:
            Major Premise:  RCW 35.81.130 authorizes any public body, including a housing authority, to donate its funds to a city in which it is authorized to act for at least those urban renewal activities which the donor can undertake independently.
            Minor Premise:  Each of the four urban renewal activities described in your letter is one which a housing authority may undertake independently.
            Conclusion:  Therefore, a housing authority may donate funds to a city in which it is authorized to act, for any of the above‑described urban renewal activities.
            We trust the foregoing will be of assistance to you.
Very truly yours,
Robert F. Hauth
Assistant Attorney General
                                                         ***   FOOTNOTES   ***
1/See, as to the nature of the plan itself as an "urban renewal" project, RCW 35.81.070, supra, subsection (6).