AGO 1966 No. 71 - Jan 26 1966
OFFICES AND OFFICERS ‑- STATE ‑- DIRECTOR OF CONSERVATION ‑- ANNUAL POWER LICENSE FEE ‑- PARTIAL REFUND.
The director of conservation is not authorized to refund to a "claimant" a portion of the annual "power" license fee for the calendar year 1965, which is required to be paid by the claimant under RCW 90.16.050, when the hydroelectric project to which the fee related is made inoperable during the calendar year 1965, by an "Act of God."
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January 26, 1966
Honorable H. Maurice Ahlquist
Director, Department of Conservation
335 General Administration Building
Cite as: AGO 65-66 No. 71
By letter previously acknowledged, you have requested our opinion on two questions which we have paraphrased as follows:
1. Is the director of conservation authorized to refund to a "claimant" a portion of the annual "power" license fee for the calendar year 1965, required to be paid by claimant under RCW 90.16.050, when the hydroelectric project to which the fee related is made inoperable during the calendar year 1965 by an "Act of God"?
2. If the answer to question 1 is "yes," may the amount of the refund be deducted from the annual license fee required for said project for 1966?
We answer question 1 in the negative. Answering it as we have, question 2 requires no answer.
RCW 90.16.050 provides in pertinent part:
"Every person, firm, private or municipalcorporation, or association hereinafter called 'claimant',claiming the right to the use of [[Orig. Op. Page 2]] water within or bordering upon the state of Washington for power development, shall on or before the first day of July, 1929, and on or before the first day of January of each year thereafter pay to the state of Washington in advance an annual license fee, based upon the theoretical water power claimed under each and every separate claim to water according to the following schedule:
"For projects in operation: For each and every theoretical horsepower claimed up to and including one thousand horsepower, at the rate of ten cents per horsepower; for each and every theoretical horsepower in excess of one thousand horsepower, up to and including ten thousand horsepower, at the rate of two cents per horsepower; for each and every theoretical horsepower in excess of ten thousand horsepower, at the rate of one cent per horsepower.
"For undeveloped projects, the fee shall be at one‑half the rates specified for projects in operation; for projects partly developed and in operation the fees paid on that portion of any project that shall have been developed and in operation shall be the full annual license fee above specified for projects in operation, and for the remainder of the power claimed under such project the fees shall be the same as for undeveloped projects. . . ." (Emphasis supplied.)
You relate that the project of a "claimant" was fully developed and in operation on January 1, 1965, and that claimant paid its annual power license fee for 1965 on that basis. However, in May of 1965, an earth slide, which you characterize as an "Act of God," destroyed the power generating plant thereby making the project inoperable.
You then ask: Is the claimant entitled to a pro-rated [[prorated]]refund for that period of 1965 when the project was not in operation?
A license fee or tax is defined in Black's Law Dictionary (4th Ed. 1951) at page 1069, as the
". . . Price paid to governmental or municipal authority for a license to engage in and pursue a particular calling or occupation. . . ."
[[Orig. Op. Page 3]] and
". . . includes both charge imposed under police power for privilege of obtaining license to conduct particular business, and tax imposed upon business for sole purpose of raising revenue; . . ."
See generally 33 Am.Jur., Licenses, §§ 3, 7 and 8. The charge in question is a "license fee" which must be paid by all "claimants" who presently claim a right to use waters in the state, now or in the future, for the generation of hydroelectric power.1/ The amount of the annual license fee, as set forth in RCW 90.16.050, depends upon the condition of the project at the time the statement of claim is filed and license fee paid; that time being January 1 of each year.
The right to a refund of a license fee or a tax is a matter of legislative grace which may be restricted or limited. 53 C.J.S., Licenses, § 57. Wasena Housing Corporation v. Levay, 188 Md. 383, 52 A.2d 903 (1947). Likewise, the grounds upon which a refund may be obtained are governed by statute.Elliott & Co., Inc. v. State, 191 Wash. 385, 71 P.2d 168 (1937). Further, no executive or ministerial officer has authority to refund a tax, unless such authority is expressly conferred thereon by the legislature. 3 Cooley Taxation, § 1259 (4th Ed. 1924).
Our examination of RCW 90.16.050 through RCW 90.16.090, the sections dealing with the license fee in question, fails to disclose any provision authorizing refunds of portions of said fee under any conditions whatsoever. To the contrary, RCW 90.16.090 designates specifically, and without exception, to what fund the fee is to be credited and how it is to be used.
It is true that RCW 43.88.170 contains the following provision:
"Whenever any law which provides for the collection of fees or other payment by an agency [[Orig. Op. Page 4]] does not authorize the refund of erroneous or excessive payments thereof, refunds may be made or authorized by the agency which collected the fees or payments of all such amounts received by the agency in consequence of error, either of fact or of law. The regulations issued by the governor pursuant to this chapter shall prescribe the procedure to be employed in making refunds."
This section, without question, would authorize the director of conservation to make refunds in certain situations. However, in our opinion it is inapplicable here. This section authorizes refunds of fees received "in consequence of error, either of fact or of law." The fee paid by the claimant in question on January 1, 1965, was based upon the condition of the project on that day ‑ a "project in operation" ‑ and upon the "theoretical water power claimed" for 1965, exactly as required by statute.2/ Under such circumstances, the license fee paid by claimant cannot be construed as "erroneous or excessive" within the meaning of RCW 43.88.170, but indeed was paid in full compliance with the controlling section, RCW 90.16.050.
In our opinion, the fee required by RCW 90.16.050 is a charge which must be paid by claimant if it desires to continue to retain its claimed right to make use of waters of the state for power purposes.3/ Nowhere in the pertinent [[Orig. Op. Page 5]] sections of chapter 90.16 RCW is there any indication that a partial refund of the claimant's license fee is authorized because the amount of hydroelectric power actually produced during the license year was less than the amount of theoretical horsepower claimed at the beginning of the year, or because a change in the operating condition of the plant took place during said year. The fee, being computed correctly, based on the operating condition of the project at the beginning of the year and the claimed theoretical horsepower of the project, is not subject to a refund even though the project becomes inoperable during said year by an "Act of God."
You are therefore advised that the director of conservation has no authority to grant a partial refund of a power license fee where a claimant's project becomes inoperable due to an "Act of God."4/
We trust the foregoing will be of assistance to you.
Very truly yours,
JOHN J. O'CONNELL
CHARLES B. ROE, JR.
Assistant Attorney General
*** FOOTNOTES ***
1/The term "license fee" or "license tax" is often used interchangeably. State v. Consumers Cooperative Association, 163 Kan. 324, 183 P.2d 423, 449 (1947);State v. Vinther, 176 Wash. 391, 29 P.2d 693 (1934).
2/The last sentence of RCW 90.16.060 provides:
". . . The amount of the theoretical horsepower upon which fees shall be paid under the provision of this act, shall be computed by multiplying the maximum amount of water claimed, expressed in cubic feet per second of time, by the average fall utilized, expressed in feet, and dividing the product by 8.8."
3/By RCW 90.16.060, the failure to file a claim to water for power purposes as required by RCW 90.16.050, results in an abandonment of any claim one may have to use public water for such purposes.
4/Note is made of the cases of Bart v. Pierce County, 60 Wash. 507, 111 Pac. 582 (1910); and Pearson v. Seattle,, 14 Wash. 438, 44 Pac. 884 (1896). In theBart case the court held that where, by "operation of law" a county liquor license was invalidated, the licensee was entitled to a refund of a portion of a license fee. Likewise, in thePearson case, where an "amusement license" authorizing certain activities was invalidated by an ordinance enacted after the issuance of the license by the governmental body prohibiting such activities, the license holder obtained a refund. Our conclusion does not conflict with either of these cases for both are based on the proposition that the license holder was, by subsequent act of a governmental body, no longer authorized to carry on the very activities which he had been licensed to do. Such a condition is not present here.