No exception was made in the court below to the manner in which this suit is constituted, or to want of capacity of some of the defendants, as sued, in relation to the subject matter of the action. No doubt the parties desired a decision more broadly dealing with the merits of the case, as voiced by the challenge to the constitutionality of the Retirement Act and its interpretation in connection with related statutes, particularly the tax limitation adopted by popular vote for supplements under the School Machinery Act. We review the case in that light.
But the joinder of parties defendant and the capacity in which they are sued suggest that plaintiffs considered themselves as dealing with an attempted exercise of authority by the city of Charlotte as a municipality and with the “Board of School Commissioners of the City of Charlotte,” formerly an agency of the municipality, as a corporate body retaining the relation to the schools in that district given it in the special act of incorporation. That is not the case. The present situation will be much less confusing if we remember that the Charlotte School District, operating as a special charter district, came squarely within the revolutionary fiat of section 4, chapter 562, Public Laws of 1933: “All school districts, special tax, special charter or otherwise, as now constituted for school administration or for tax levying purposes, are hereby declared non-existent.” Under the further provisions of this Act, the Charlotte district became a city administrative unit, and the trustees of the former district were retained only as the local administrative body of that unit, shorn of all administrative authority other than that which they get from the School Machinery Act. This concession was made to the governing body of the old district, no doubt, to cushion the shock of total liquidation and out of deference to the importance of the trusts that had been committed to them — the magnitude of the schools — and to conserve the experience and interest built up in administration. But here the old regime ended and the new dispensation began. The unit was now a part of the Public School System and henceforth an agency of the State. In this is found the principle upon which our decision must rest. Its application will be as brief as a full understanding of the subject will permit.
The plaintiffs contend that the law is unconstitutional and invalid; that the expenditure required comes within the purview of Article VII, section 7, of the Constitution, prohibiting taxation by a municipality, except for a necessary expense, without submitting the question to a popular vote; that if the payment out of the Retirement Fund is not salary, the law is offensive to Article I, section 7, of the Constitution, which provides that no man or set of men are entitled to exclusive or separate emoluments or privileges from the community, but in consideration of public services; and that if in the nature of salary, it necessarily comes within the purview of the 1933 School Machinery Act as a part of the supplements heretofore approved by popular vote, subject to the 25c on the $100 limitation on the tax rate heretofore adopted. There is a further contention that the Act contravenes Article V, section 3, of the Constitution as being inequitably levied and not for a public purpose. ¥e consider these objections as nearly in that order as convenience permits.
1. The Constitution of North Carolina recognizes that it is the duty of the State to establish and maintain “a general and uniform system of public schools, where tuition shall be free of charge to all children of the State between the ages of six and twenty-one years.” Constitution, Article IX, section 2. Under Article IX, section 3, the State is required to be divided into a convenient number of districts, in which one or ■ more public schools shall be maintained at least six months in the year.
The plea that the levy of such a tax by a county, without submission to popular vote, is prohibited by Article VII, section 7, of the Constitution, as not being for a necessary expense was raised and settled in Collie, v. Commissioners, 145 N. C., 170, 59 S. E., 44, by the declaration that the requirement that the public schools be maintained is a mandate of a co-ordinate article of the Constitution of equal dignity and force, and must he obeyed; and that Article VII, section 7, had no relation by way of limitation on the taxing power exercised for that purpose. Three of the Justices of the great Court which decided this case, in separate concurring opinions, wrote their names upon this monument to our educational progress.
There was in the mind of the Court a clear comprehension of the functions and powers of the State and of the agencies set up to perform this duty, and there was no confusion at any time as to where the ultimate duty and power was seated; and none, we think, as to the consequences which must follow a delegation of this 'duty and power as a matter of convenience of administration to the agencies selected. Nor should there be any doubt today that maintenance of the public schools and the furnishing of those things which are reasonably essential to that end are within the mandatory provision of the Constitution, unaffected by the “necessary expense” provision contained in the municipal section of the Constitution.
The State is not a municipality within the meaning of the Constitution. It seems to us self-evident that it may perform the duties required of it by the Constitution, as well as exercise those powers not otherwise prohibited, without embarrassment by constitutional limitations expressly operating on municipalities alone. Const., Art. IX, secs. 2, 3; Const., Art. VII, sec. 7. The public school system, including all its units, is under the exclusive control of the State, organized and established as its instrumentality in discharging an obligation which has always been considered direct, primary and inevitable. When functioning within this sphere, the units of the public school system do not exercise derived powers such as are given to a municipality for local government, so general as to require appropriate limitations on their exercise; they express the immediate power of the State, as its agencies for the performance of a special mandatory duty resting upon it under the Constitution, and under its direct delegation.
This view is clearly expressed in Frazier v. Commissioners, 194 N. C., 49, 61, 138 S. E., 433, from which we quote:
To the same effect are Owens v. Wake County, 195 N. C., 132, 136, 141 S. E., 546; Lacy v. Bank, 183 N. C., 373, 380, 111 S. E., 612; Lovelace v. Pratt, 187 N. C., 686, 689, 122 S. E., 661; Tate v. Board of Education, 192 N. C., 516, 520, 135 S. E., 336.
From these cases, as well as from the reasoning of the matter, we gather a clear impression that whatever may be the limitations on a municipality with respect to its ordinary government under Article VII, sec. 7, they do not apply to it as an authorized agency in connection with the public school system; and that they do not, in fact, apply to any agencies as school administrative bodies, some of which, indeed, have no municipal functions to becloud the issue. In many city administrative units, the boundaries of the unit do not coincide with the city limits.
Attention should be directed to the distinction drawn in the decisions between agencies created for administrative purposes within the public school system and charter districts incorporated by special acts of the Legislature and empowered to maintain and conduct schools independently of it, which do not proceed on the authority as it comes from the State, through Article IX of the Constitution. Frazier v. Commissioners, supra; Owens v. Wake County, supra. Such independently operating schools were abolished by chapter 562, Public Laws of 1933, sec. 4, along with all other taxing districts — doubtless with the intent to bring all such activities within the public school system, and 'to secure uniformity and equality of opportunity into the school effort throughout the State. The city administrative unit and the county administrative unit, administrational devices first adopted in this Act, are not allied to such specially incorporated schools. They are, as the name implies, units within the public school system — established agencies of the State to carry on the then existing functions of the public school system, and logical and convenient agencies for investment with further power and duties as might be found expedient or necessary.
The suggestion that the Retirement Plan and payments of benefits thereunder are intrinsically not necessary purposes for maintaining the public school system is no doubt advanced under the same contention that taxation and expenditure under the Retirement Act must necessarily come within the limitation of Article VII, sec. 7, of the Constitution— a proposition we are compelled to reject for the reasons above stated; but we have the implied suggestion that they do not have that relevancy to the purposes expressed in Article IX of the Constitution that would bring them within that authority.
The extent to which the measures provided in the Retirement Act may be auxiliary to the efficient administration of the public school
We understand that what courts appropriately refer to as the “mandate” of Article IX of the Constitution carries with it not merely the bare necessity of instructional service, but all facilities reasonably necessary to accomplish this main purpose. And in this respect the word “necessary” has long been regarded as a relative, not an exigent, term— certainly not one which may be used to drain the life and substance out of. a project with which it is connected, but one which itself must accept an interpretation consonant with the reasonable demands of social progress. We do not differ with the General Assembly in its policy as expressed in this legislation, but we point out that the matter is exclusively within the province of that body. It is their verdict, embodied and expressed in the Act, that the Retirement Plan has a definite relation to the just and efficient administration of the public school system which brings it within the scope of constitutional authority. Under the mandatory provisions of the Retirement Act, the public policy' thus expressed is applied to the entire public school system and its administration at the hands of every administrative unit within it. After all, it is difficult to see how any want of relevancy, even if it could be supposed to exist, would bring the subject within the purview of Article YII, sec. I, of the Constitution.
It is true,'as suggested, that the city administrative unit, under the provisions of the School Machinery Act, voluntarily undertook to supplement certain items of State expenditure and thereby undertook to conduct a school of higher standard and longer term than that provided by State support. But once having assumed the burden, albeit voluntarily, the unit did not thereby separate itself from the school system, or break the thread of constitutional authority, or exempt itself from the consequences of the burden it assumed, or the additional trusts imposed by law.
The provision in the School Machinery Act under which a local unit desiring to supplement State support for the schools is required to submit the question to a popular vote is not in deference to Article YII, sec. Y, of the Constitution. It is simply the legislative adoption of a similar method of control over extravagant expenditure pro hac vice. It does not affect the status of the administrative unit as an agency of the State. And when the burden is assumed, the Act under consideration not only confers authority, but is mandatory in its provisions that
The theory that the obligation of the Constitution extends no further than the six months school term, the minimum requirement expressed in Article IX, sec. 3, is unsound. The mandate is expressed in its simplest and most comprehensive form in sec. 2, without qualification or limitation, except that implied from the ability of the State to respond. The State does, from its ordinary revenues, support an eight months school term under the 1933 Act, without impeachment of exceeding its power. Indeed, the situation would remain unchanged if there were no constitutional requirement at all, since, without it, the duty of the State to educate its citizens has been recognized amongst intelligent and civilized peoples from antiquity. It is no doubt written into the fundamental law so that it may survive political indifference and so that the humblest citizen, speaking for himself and those in like right, may demand its performance. It is merely a question of transmitting authority to a lawfully designated agency, and of the quality and extent of the power so delegated.
2. The plaintiffs argue that unless the payment out of the Retirement Fund is in the nature of a salary, it is a gratuity and offensive to Article I, sec. 7, of the Constitution, which provides that no man or set of men are entitled to exclusive or separate emoluments or privileges from the community, but in consideration of public services.
It is conceded by the plaintiffs that if payment from the fund is in the nature of salary or compensation for services rendered, it is at least not offensive to Art. I, sec. 7, of the Constitution.
We do not have to decide whether the cited section of the Constitution narrows its exception to payment for services currently rendered. The appellants are content to have the payments from the Retirement Fund, hypothetically, at least, regarded as deferred payments of salary. The appellees argue, and sustain the argument, we think, by convincing authority from jurisdictions where the question has been raised, that the benefits from the Retirement Fund may be so regarded. Schieffelin v. Berry, 217 App. Div., 451, 216 N. Y. Supp., 367; People ex rel. Kroner v. Abbott, 274 Ill., 380, 113 N. E., 696; Cobbs v. Home Ins. Co., 18 Ala. Ap., 206, 91 So., 627; Whitehead v. Davie, 189 Cal., 715, 209 Pac., 1008; Talbott v. Independent School District of Des Moines, 230 Iowa, 949, 299 N. W., 556; Retirement Board v. McGovern, 316 Pa., 161, 174 Atl., 400.
3. It is conceded that the contribution of the unit to the State Retirement Fund might be paid out of local funds collected under the 25c levy
Moreover, the funds so collected are not supplemental in character and are not locally expended. They go into a general State fund, out of which payments are made irrespective of the source of origin.
We are likewise of the opinion that the contemplated levy is not limited or controlled by section 55 (4) of the City Charter — chapter 366, Public-Local Laws of 1939. The provision there is :
“The City Council of the City of Charlotte shall levy an annual tax for the support and maintenance of said public schools in the City of Charlotte in accordance with the Public Laws of the State of North Carolina as the same may now or hereafter be enacted and in any amount which is now or may hereafter be approved by a vote of the people of said city for said purposes.”
We do not think that the subject dealt with in the Eetirement Act of 1941 was within legal contemplation of this law. At most, it gives authority for further taxation in the support of schools as might be approved by a vote of the people, but does not prevent a levy under an appropriate State law, irrespective of the statute. We regard the point as settled adversely to appellants’ contention by Julian v. Ward, 198 N. C., 480, 152 S. E., 401.
4. The challenge to the Eetirement Act as contravening Article Y, sec. 3, of the Constitution is not supported by argument or citation of authorities. Perhaps the inequalities which are pointed out by the appellants, and which we do not regard as inequities, may be corrected by further experience in the administration of the Act.
The contention that the Act does not comprehend a public purpose cannot be sustained. If the Eetirement Plan has that relation to the public school system which the legislative policy supposes it to have, and
The Act includes thousands of teachers and employees of the State, as a class and without discrimination. If this is not sufficient to satisfy the “public purpose” requirement of the Constitution, the benefit they receive may be regarded as incidental. The benefit to the general public comes from a policy, widely approved, and adopted here, not without careful and exhaustive study, and with appreciation of its effect upon the entire citizenry, in the enhancement of the State’s largest and most important enterprise, the conduct of the public schools. The relation of the Retirement Plan to the public school system has been fully discussed above, and the discussion will not be repeated here. It is sufficient to say that the expected improvement in standards of service, and the stabilization of teacher employment, are sufficient to constitute a public purpose, and justify the imposition of the tax.
We conclude that the Act is a constitutional and valid expression of the legislative will, both generally and in its application to'the local administrative units with which it deals. The contribution to the State Retirement Fund required of the Charlotte City Administrative Unit is mandatory in character, does not require submission to popular vote, and is not affected by the maximum tax rate heretofore adopted by this unit in voting supplements to the schools or the suggested limitations of the city charter.
The acting defendants are in the exercise of lawful powers and are not subject to judicial restraint.
The judgment of the court below is
Affirmed.