Burnes v. Mayor of Atchison

By the Court,

Kingman, J".

This action in the Court below was brought .to restrain by injunction the collection of a tax of one per cent, upon the real estate of the plaintiffs in the City of Atchison, levied to pay the interest on certain bonds issued by the authority of the city for certain railroad stock, and a tax of one per cent, for the improvement of streets and alleys in addition to one per cent, levied for general city revenue, and paid by plaintiffs, on the ground that the city had no power to impose such taxes. A judgment was rendered for the defendants below, which is brought here for review.

Section 11 of the charter of the City of Atchison (Private Lems of 1858,- p. IK), provides: “ That the Mayor and Board of Councilmen shall have power by ordinance to levy and collect taxes not exceeding one per centum upon real and personal property within the city, and upon property, lands, lots, interests or shares held, owned or claimed by any person or persons, company, firm, association or corporate body, whether the title of the United States thereto be extinguished or not, upon the assessed value thereof, and all moneys on hand or on' deposit, bills of exchange, bonds, notes and other securities held upon solvent persons or corporations, over and above the just debts or liabilities of the owner or holder thereof.- To levy and collect a poll tax, not exceeding one dollar per annum,' upon every free male person over twenty-one and under fifty-five years of age. To levy and collect special tax on the holders of the lots in every street, lane, alley or avenue, according to their respective fronts owned by them, for the purpose of grading and improving the same, for curbing and paving the sidewalks and lighting such .street, lane, avenue or alley. To levy and collect a tax on dogs,’ not exceeding five dollars each, per annum.” And then proceeds to grant power to license and tax certain occupations, t&c., but grants no further power to tax.property, ’

*484By the 4th section of an act amendatory of said charter, passed Eeb. 11th, 1859, it is provided that, “ The Mayor and Council shall be authorized to levy a tax upon all real estate, lot or lots lying upon any street or alley for the grading, paving or macadamizing thereof, either' by the front foot or the assessed value thereof.”

These provisions contain all the powers of taxation expressly granted to the City of Atchison by its charter. It will be seen that, the charter first confers the power of general taxation to the amount of one per centum upon real and personal property, and then proceeds to authorize the levy of a special tax on the holders of the lots in every street, lane, alley or avenue for the improvement of such streets, &c.

The language of the section clearly grants the power of taxation upon any or all, the different streets, &c., as distinct taxation districts, and is therefore clearly intended, not as a pgrt of the general tax of one per cent., but as additional to such general tax.

Tlie amendment above cited authorizes such tax to be levied by the front foot of the property taxed, or the assessed value thereof. And by the agreed statement of facts upon which this cause was tried, it appears that the assessment of tax for street improvements was upon the assessed value of the property abutting on the streets, and in strict, conformity with the charter of the city as amended.

• But it is claimed that the Legislature could not confer upon the city the- right to impose such tax.

As. the charter, was passed and the tax levied during the existence of the territorial, government, the powers of the Legislature are to be sought in the “ Organic Act.”

The 24th section of that act provides ■“ That the legislative power of the, Territory shall extend to all rightful subjects of legislation consistent with the Constitution of the United States and the provisions of this act. But no law shall be passed interfering with the primary disposal *485of the soil; no tax shall be imposed upon the property of the United States, nor shall the lands or other property of non-residents be taxed higher than the property of residents.”

This provision conferred upon the Territory all the legislative power of a Stato government, unrestricted by its constitution except in the particulars above stated.

The granting of municipal powers, including powers of local taxation, for the improvement of streets and other purposes, to cities and villages is an ordinary act of legislation in immemorial use, and probably exercised by every State and Territory in the Union, and no Court that we are aware of has ever pronounced such legislation void.

Whether a Legislature could authorize a municipal corporation to assess' property for street improvements, not according to the value, but according to the supposed benefit to accrue from the improvement to the property taxed, has sometimes been questioned, though generally, if not uniformly, such legislation has been sustained. But the. tax under consideration involves no such question. It was assessed according to value upon the property abutting the street to be improved, and differs from ordinary taxation only in being levied upon streets instead of larger districts. It is quite analagous in principle to the method of assessment of highway labor by districts in use in this and many other States. It is not taking private property for public use without just compensation, but a method of distributing among the citizens the public biu-then of improving the streets. We think the assessment for improving streets was valid.

Section five of the act above cited amendatory of the charter, authorizes the sale of land for taxes, and we therefore see no grounds for restraining the collection in that manner of the tax under consideration.

The tax for the payment of interest on railroad bonds was for the payment of bonds issued under Section 30 of *486the city charter, which reads as- follows: “ That the City of Atchison as hereby incorporated, shall have power to subscribe for stock in any railroad company proposing to build a railroad leading to or from said City of Atchison in Kansas Territory,-or opposite to said city on the bank of the Missouri River, in the State of Missouri, provided that the stock subscribed for, and not actually paid in, shall not at. any time exceed two hundred thousand dollars, and provided that said city shall not subscribe- for more than one hundred thousand dollars of such stock in any one year, provided also that said city shall not subseribe-for. any such stock at any time until a proposition for thus subscribing shall have been submitted to a vote of the qualified voters in said city, and if a majority of the .votes polled approve of the proposition the stock may be subscribed, otherwise it shall not be.” , •

It is argued for the plaintiff that this section confers no authority to issue such bonds on the grounds: first, that the Legislature had no power to authorize the city to take railroad stock; and second, that the law requiring the.proposition to subscribe to be submitted to .the people for their approval, the subscription was void for that reason, within the principle of Barto v. Himrod, (8 N. Y., 483,) and kindred cases.

Ye will consider these points in their order.

"We have already seen that the Legislature which passed the charter in question, was invested with all the powers of a State Legislature, without any constitutional restriction affecting the question under consideration, and. we. see no reason to doubt that the legislative power óf a State extends to the creation of municipal corporations, and granting them such powers, not in conflict with th.e organic law of the. State or nation, as the Legislature shall deem wise, relating to the public interests of the Territory included within the bounds of such corporation.

( The apparent object of the Legislature in granting to the City of Atchison, the power to subscribe for railroad stock *487and raising a tax to pay for it, and of the city in exercising such power was by railroad connections to build up the material interests of that city. This was a legitimate object for public effort, and whether the policy adopted to effect it was wise or unwise, just or unjust, were questions addressed to the sound discretion of the Legislature, but in no degree affecting its power.

Does the provision for submitting the question for subscribing stock to a popular vote of the city invalidate the law?

The case of Barto v. Ilimrod, (4 Seld.. 483,) and other cases cited by the plaintiff upon this point are cases in which a proposed law affecting the whole State was submitted to the voters of the whole State to determine whether it should become a law. But the action complained of in this case is merely the submission of local questions of expenditure and taxation to the voters of the corporation which is to bear the expense and receive the benefits of it. If the Legislature might authorize the city to take railroad stock, it could make no difference with the legality of' the act whether the question of subscribing for such stock were submitted to the whole body of corpora-tors or to their representatives. If the one would be a delegation of legislative power the other would be equally so; the second question is merged in the first, and the authorities sustaining the first will also sustain the second.

The case of the Bank of Borne in the New York Court of Appeals, (18 N. Y., 38,) was an action for interest due upon a bond of the corporation issued for railroad stock, pursuant to an act of the Legislature authorizing the corporation to take stock in a railroad, terminating at that village, and to issue bonds therefor, but providing that no subscription to the stock' should be made nor bonds issued “ under the act until it had been approved by two-thirds of all the electors who shall have paid a tax on personal or real estate in said'village, whose names shall appear regrn *488larly on the last village assessment roll in which “ the vote is taken.” The Court held that the Legislature had the power to authorize, the village to subscribe for the stock and issue its bonds, and that the submission of the question of making the subscription to the people, did not invalidate the act. After distinguishing ihr.t case as we have this from the case of Barto v. ITimrcd previously decided in the same Court, the learned judge delivering the ojfinion, proceeds to say : “ The ease is therefore in substance only a submission to a vote of the parties interested, of the question whether or not they choose that the municipal corporation should subscribe "to the railroad; in other words the Legislature did not compel the village to subscribe, Ifut creating by law the necessary machinery left it to the taxpayers to determine the matter.”

The case of the Cincinnati, Zanesville and Willmington railroad v. The Commissioners of Clinton County, (1st Ohio State, 77,) involved the same points, with the difference only that the tax was assessed upon a county instead of a municipal corporation, and the Supreme Court of that State in an elaborate opinion maintained the same doctrine. The case of the City of St. Louis v. J. H. Alexander, (23d Mo. Rep., 483,) involved the same questions, and the Supreme Court of Missouri decided them in the same way. Other cases of similar import might be cited from different States were it deemed necessary.

That the proposed railroad was to be built outside the Territory of Kansas, cannot effect the case. The first object of the legislation in question is not the benefit of the State at large but of the municipality to bear the expense of the improvement.

In the case of the City of St. Louis v. Alexander above cited, the city subscribed for stock in the Ohio and Mississippi railroad, a work entirely outside of the State of Missouri, and the transaction was as we have already observed, sustained by the Supreme Court of that State.

*489"We entertain no doubt that the City of Atchison had power to subscribe for railroad stock, and to issue bonds therefor pursuant to the provisions of its charter, and to pay the interest and principal of such bonds by a tax upon real and' personal property within the limits of the city, provided that the whole amount of taxation assessed upon such property by the city government did not exceed in amount the limits prescribed by the city charter.

The general taxing power of the city government is limited to one per centran upon the real and personal property within the city by the express language of the charter. And there is no provision in the charter for any special tax for railroad purposes. One per cent, having been levied for general revenue, what power then remained to assess one per cent, for interest on railroad bonds ?

It is argued that the power being given to subscribe for stock, the power to levy a tax to pay for such stock must be implied from its necessity. It would be better logic to say that the limitation on the power of taxation is and was intended to be a check upon the public expenditures of the city for .railroad stock, as well as other purposes. In the case of the City of Leavenworth v. Margaret Norton et al. (1 Kans. R., 432,) substantially the same question was presented, and this Court held that the power of taxation could not be so implied.

¥e entertain no doubt that the assessment of the tax in question was unauthorized by law, and therefore void. But inasmuch as the petition presents no sufficient grounds for an injunction, the remedy at law being clear and undoubted, the decision of the Court below must be sustained.