AGO 1955 No. 46 - Mar 25 1955
LOCAL IMPROVEMENT DISTRICTS ‑- POWER TO AMEND ORDINANCE AFTER COMPLETION OF WORK TO PROVIDE FOR SHARING IN COST BY OTHER CITY FUNDS.
When a city initiates a local improvement proceeding and constructs the improvement with the purpose, from the beginning to pay therefor exclusively from the proceeds of special assessments against property which it is contemplated will be benefited thereby, the city cannot legally share the costs thereof from other city funds which might have been used in the inception of the improvement.
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March 25, 1955
Honorable Cliff Yelle
Olympia, Washington Cite as: AGO 55-57 No. 46
Attention: !ttMr. A. E. Hankins,Chief Examiner
In your letter of February 28, 1955, you asked our opinion on the question:
"Can the city commission, where a local improvement district has been created, providing that all costs of the improvement be borne and assessed against the property included in the district, amend the ordinance ordering the same, after the work has been completed, to provide, that the city shall share a proportionate cost of the improvement?"
Our answer is in the negative.
We assume that the property included within the district is specially benefited [[Orig. Op. Page 2]] to the full extent of the cost of the improvement.
Insofar as the general fund is concerned or the issuance of general obligations for the purpose of defraying part of the cost, the case of Pratt v. Seattle, 111 Wash. 104, is a complete answer. Although the court held that general obligation bonds were justified for the payment of condemnation awards for property required in connection with the improvement, it would not permit either the issuance of general obligation bonds or the assumption of a part of the indebtedness by the city's general fund for the purpose of paying part of the cost of the special improvement. Almost in direct answer to our question here, the court said at page 110:
"* * * when a municipality initiates a local improvement proceeding and constructs the improvement with the avowed purpose, from the beginning, to pay therefor exclusively from the proceeds of special assessments against property which it is contemplated will be benefited thereby, the city does not become liable for any part of the cost of such improvement as a general indebtedness; * * *" (Citing cases)
This conclusion was reiterated by the court in the following words, at page 118:
"* * * It has been uniformly held by this court that municipalities are not legally liable to pay from their general funds any of the cost of the physical construction of local improvements which they avowedly initiate and carry to completion to be paid for solely from funds to be raised by special assessment against property which it is contemplated will be benefited thereby, and this is so even though the special assessment prove unavailing in raising sufficient funds to pay the cost of such improvement. [Citing numerous cases.] * * *"
[[Orig. Op. Page 3]]
Anticipating that the foregoing will give rise to the obvious question of the possibility of the use of other funds of the city for such purpose, we have explored this phase of the question. We believe that our supreme court has answered this question just as definitely in the negative in the case of State ex rel. Collier v. Yelle, 9 Wn. (2d) 317. This case involved the constitutionality of a legislative act which would have permitted the city of Seattle to defray a part of the costs of the special assessments for the construction of Aurora Avenue from its share of the proceeds from the motor vehicle fund. Although, in that case the assessment roll had already been confirmed and the city was merely reducing the amounts thereof by a proportional application of the motor vehicle revenues, we think the reasoning of that case extends to the question here. It was suggested that the 14th Amendment to the state constitution applied only to taxes levied against property, but the court determined that it applied to all taxes collected by the state, including property, excise and all other taxes and specifically mentioned the state sales tax and the gasoline tax. Referring to subdivision 10 of Article II, § 28, of our state constitution, the court said at page 330:
"* * * It supplements Art. VII, § 2, as amended by the fourteenth amendment above referred to, providing for the uniformity of taxes, and protects the taxpayer from legislative action designed to shift to one group a disproportionate burden of taxation by releasing or extinguishing, by special statutes, the tax obligations of a favored group. * * *"
The argument was further made that since the city might have provided for a sharing of the cost of the improvement, therefore, it should be permitted to do so at a later period. But, the court said at page 332:
"* * * It consequently does not follow that what the legislature might have done when the work was ordered, it can do now, in violation of constitutional prohibition."
And, the court concluded with the following statement at page 334:
"An unjustifiable preference for the benefit or relief of one special group of taxpayers, [[Orig. Op. Page 4]] to the detriment of all other taxpayers, cannot be upheld as based upon a moral obligation, and for that reason for a public purpose."
The conclusion of the court in that case holding the act of the legislature unconstitutional would seem to have the same application to an ordinance amending the ordinance initiating the project to accomplish the same purpose.
Accordingly, we conclude that when a municipality initiates a local improvement proceeding and constructs the improvement with the avowed purpose, from the beginning, to pay therefor exclusively from the proceeds of special assessments against property which is contemplated will be benefited thereby, the city does not become liable for any part of such improvement payable out of any other funds of the city even though such funds might have been used for the work when it was originally ordered.
We trust that the foregoing will be helpful to you in connection with the problems involved.
Very truly yours,
Assistant Attorney General