City of Springfield v. Director of Revenue

WELLIVER, Judge,

dissenting.

I respectfully dissent.

Article III, § 39(10) of the Missouri Constitution provides: “The general assembly shall not have the power: ... (10) To impose a use or sales tax upon the use, purchase or acquisition of property paid for out of the funds of any county or political subdivision.”

The principal opinion circumvents the plain, clear and unequivocal words of this provision by ruling that “[t]he sales tax is nothing more than a tax on gross receipts from the selling of goods or providing services at retail.” Supra at 784. The majority ignores the apparent purpose of art. Ill, § 39(10) and distorts the holdings in our prior decisions in their quest to ever-extend the Director of Revenue’s taxing power.

The majority relies on State ex rel. Arenson v. City of Springfield, 332 S.W.2d 942 (Mo. banc 1960), and St. Louis Country Club v. Administrative Hearing Commission, 657 S.W.2d 614 (Mo. banc 1983) as authority for permitting the Director of Revenue to assess the tax against the City of Springfield. I am convinced neither decision supports the result announced today. Arenson involved a challenge by the City of Springfield to a tax which the legislature authorized to be assessed against “special fuel” received, delivered, or placed in the fuel tanks of certain motor vehicles. The City used the fuel in its municipally-owned buses. The opinion distinguishes the tax therein levied from the typical sales or use tax, stating:

We cannot escape the conclusion that the legislature intended that the tax was to be imposed on the use of the highways and not on the use of the fuel consumed in using the highways ... The tax was essentially a privilege or license tax imposed for highway use.

Id. at 948-49. It escapes me how a case decided on these grounds can support a decision authorizing a sales tax on municipally-supported services and activities.

Nor do I believe § 144.020 and § 144.010, RSMo Supp.1982, as interpreted in St. Louis Country Club, authorize the tax challenged herein. In St. Louis Country Club, this Court held that the Director of Revenue *786may tax fees charged to members who brought in guests to club facilities. Though I did not sit in that case, I agree with much of what is stated in Judge Donnelly’s dissent. St. Louis Country Club at 618. Whatever my views on the merits of that case, I fail to see how the result there has any bearing on the facts of this case. The principal opinion states that “it is apparent that the recreational facilities provided by the City in this instance would fall within the same taxing category and holding of the St. Louis Country Club case.” Supra at 785. It is not apparent to me why recreational facilities provided by tax funds and for the benefit of the general public should be treated in the same manner as privately owned country clubs operated for the benefit of its members. The private nature of the recreational facilities in St. Louis Country Club renders that case wholly inapposite from the instance one. The majority’s conclusion that rich and poor should be taxed alike as they pursue their recreational endeavors ignores the critical fact that the services and activities sought to be taxed herein are supported by public funds.

In my opinion, today’s decision undermines the intended purpose of art. Ill, § 39(10). As a result of this decision, the state can take a cut of the moneys that political subdivisions generate to recover the costs of providing recreational activities and facilities. Even if the City is, as the majority contends, “selling ... goods or providing services at retail,” these functions clearly constitute the “use, purchase or acquisition of property paid for out of the funds of any county or political subdivision.” Thus, I must dissent from the Court’s decision.