Grossman v. State, Dept. of Natural Resources

NO. 83-453
IN THE SUPREME COURT OF THE STATE OF MONTANA

1984

RAY GROSSMAN,

Plaintiff and Appellant,

STATE OF MONTANA, DEPARTMENT OF
NATURAL RESOURCES, et al.,

Defendants and Respondents.

ORIGINAL PROCEEDING:

Counsel of Record:

For Appellant:

Hooks and Budewitz, Townsend, Montana
Patrick F. Hooks argued, Townsend, Fontana

For Respondents:

Hon. Governor Ted Schwinden, Helena, Montana
Hon. Mike Greely, Attorney General, Helena, Montana
Hon. Jim Waltermire, Secretary of State, Helena,
Montana
Leo Berry, Department of Natural Resources, Helena,
Montana
Robert Lane arqued, DNR., Helena, Montana
Oitzinqer and Mullendore, Helena, Montana
John J. Oitzinqer arqued, Helena, Montana
Mike Younq, Dept. of Admin., Helena. Montana
G. Steven Brown, BNR. , Helena, Montana

Submitted: March 1, 1984
Decided: May 7 , 1984

Filed:
Mh'i
Mr. Justice John C. Sheehy delivered the Opinion of the
Court.

At issue here is the state constitutionality of several
acts of the legislature allowing the issuance of state
revenue bonds. These bonds would be financed by coal
severance taxes to provide proceeds for the development of
state water resources. This action requires a decision by
the Court not only on the state constitutionality of the
enactment by the legislature of the enabling provisions, but
also the state constitutionality of the application of the
bond proceeds to the projects proposed by the legislature to
receive such proceeds.
We hold the enactments of the statutes hereinafter
enumerated and discussed relating to the revenue bonds in
question are in accord with our state constitution; and that
the proposed uses of the bond proceeds are likewise consonant
with the state constitution.
I.
Ray Grossman is a self-employed citizen of the United
States of America and a citizen, resident and registered
elector of Montana, residing in Townsend, Broadwater County.
He owns real and personal property on which he pays the State
and its subdivisions real and personal property taxes. He
also pays the State income tax on his earnings.
Grossman contends that Ch. 505, Laws of Montana (1981);
H.B. 846 (47th Leg. Assembly); and H.B. 885 (48th Leg.
Assembly), enacted as Ch. 705, Laws of Montana (19831, are
void and unconstitutional. In support of his claims, he
filed a complaint for declaratory judgment in this Court
requesting us to take original jurisdiction. The respondents
have answered the complaint urging us to accept jurisdiction,
and supporting in all particulars the state constitutionality
of the disputed acts. The respondents further request that
we grant summary judgment in favor of the State. This Court
reserved the question of assumption of jurisdiction, and
granted oral argument on all phases of the issues. The
parties have stipulated, and it appears from the record, that
there are no fact issues before us, only questions of law.

Original jurisdiction depends on the resolution of two
questions: (1.) Whether the Supreme Court has original
jurisdi-ction of such a declaratory judgment action; and (2)
if it has jurisdiction, whether Grossman has standing to
bring the action.
The original jurisdiction of this Court is defined in
Art. VII, § 2, 1972 Mont. Const., where it is provided that
we may "issu.e,hear, a.nd determine writs of habeas corpus and
such other writs as may be provided by law."
The state constitutional grant of original jurisdiction
in this Court is open to interpretation. The gra.nt was
interpreted favorably to acceptance by the Court in
Forty-Second.Legislative Assembly 17. Lennon (1971), 156 Mont.
416, 420-22, 481 P.2d 330, where, interpreting the 1889 Mont.
Const., Art. VIII, S 3, Justice Haswell (now Chief Justice)
wrote for the Court:
"A declaratory judgment action is a proper
proceeding in which to reach and answer the legal
issues raised in this proceeding. A court of
record in Montana is specifically granted the power
'to declare rights, status, and other legal
relations' of a party (section 93-8901, R.C.M.
1947) [now section 27-8-201, MCA] which 'are
affected by a statute' (section 93-8902, R.C.M.
1947) [now section 27-8-202, MCA] and in which a
declaratory judgment 'will terminate the
controversy or remove an uncertainty.' (section
 93-8905, R.C.M. 1947) [now section 27-8-205, MCA. ]
This is precisely the situation that exists in the
present case. Here we have a presently existing
bona fide , justiciable, legal controversy
concerning the authority of the legislative
assembly under the constitution and statutes of
Montana in enacting mandatory enabling legislation
for a constitutional convention. Resolution of the
issues presented herein is necessary to eliminate
or reduce a multiplicity of future litigation; to
prevent interminable delay in the election of
delegates, the formation, and the functioning of
the constitutional convention; and to eliminate
needless expenditure of public funds on procedures
that otherwise might subsequently be declared
illegal. One of the basic purposes of the Montana
Declaratory Judgments Act is to provide a procedure
for advance determination of such issues, thereby
eliminating these otherwise detrimental results.
"Under the circumstances of the present case, an
original proceeding for declaratory judgment in the
Supreme Court is likewise authorized. Jurisdiction
is granted this Court to hear and determine 'such
other original and remedial writs as may be
necessary or proper to the complete exercise of its
appellate jurisdiction. (Art. VII, 5 3, [I8891
Montana Constitution.) A similar provision exists
by statute (section 93-214, R.C.M. 1947) [now
section 3-2-203, MCA], and Montana case law is
replete with authority sustaining the original
jurisdiction of the Supreme Court in declaratory
judgment actions in a variety of situations (citing
authority) . The foregoing cases establish the
original jurisdiction of the Supreme Court in a
declaratory judgment action where legal questions
of an emergency nature are presented and ordinary
legal procedures will not afford timely or adequate
relief. Such is the situation here. We have an
urgent emergency situation in view of the mandatory
legislation required of the present session of the
legislative assembly, the absence of any factual
controversy but only pure legal questions that must
ultimately be answered by this Court in any event,
and ordinary legal procedures that will not afford
timely relief."
The wording of the judicial article defining our
original jurisdiction contained in the 1972 Montana
Constitution is different from the provisions of the judicial
article of the 1889 Montana Constitution. Does that
difference mean that the original jurisdiction power of this
Court is less than we perceived it to be in Lennon?
 During the Constitutional Convention, on March 9, 1972,
the Committee on Style, Drafting, Transition and Submission
reported on the judicial article for submission to the
convention. (Tr. at 911, 913, 1972 Montana Constitutional
Convention Proceedings. ) Art. VII ( 2 ) (1), came before the
convention floor on March 13, 1972, in the following form:
"SUPREME COURT JURISDICTION. (1) The supreme
court has appellate jurisdiction and may issue,
hear, and determine writs appropriate thereto. It
has original jurisdiction to issue, hear, and
determine writs of habeas corpus."
Motion was made to add to the subsection we have quoted
above, the language "and such other writs as may be provided
by law." In a floor discussion Delegate Berg told the
convention :
"DELEGATE BERG: Mr. Chairman. I join, of course,
in this motion to reconsider. It developed that
after we had written the article, Sandra
Muckelston, the research analyst, pointed out to us
a case in the Montana Supreme Court, known as
Naegele 5 Kelsey, in which the Supreme Court held
that under the old Constitution there was some
question, perhaps, as to whether writs--remedial
writs--might be issued if it was limited to
appellate jurisdiction as we had written it here.
It is to correct that possibility that we ask that
this amendment be made - - - conform with what
so as to
- Supreme Court - already determined -
the has its
iurisdiction - -
to be." (Em~hasisadded.) Tr at .
2178, 1972 Montana constituiional convention.
When on March 13, 1972, the Montana Constitutional
Convention was acting on Art. VII, 2 (I), the Lennon
decision was already in the books, it having been decided on
February 19, 1971. It appears evident from the discussion of
Delegate Berg that it was the intention of the delegates to
the 1972 constitutional convention that our origina.1
jurisdiction, as interpreted by the Supreme Court, be
continued. The amendment was adopted by the 1972 Montana
Constitutional Convention, so that the present form of Art.
VII, 5 2(1) , is:
 "Section 2. Supreme court jurisdiction. (1) The
supreme court has appellate jurisdiction and may
issue, hear, and determine writs appropriate
thereto. It has original jurisdiction to issue,
hear, and determine writs of habeas corpus and such
other writs as may be provided hy law."
The decision referred to by Delegate Berg in the
const.itutiona1 convention is State ex rel. Nagle v. Kelsey
(1936), 102 Mont. 8, 55 P.2d 685. In that case the Court
discussed whether it had jurisdiction to accept an original
proceeding for a writ of quo warranto. The contention was
made that an original proceeding was not appropriate to the
appellate jurisdiction, and therefore this Court had no
jurisdiction. In refuting the contention, this Court pointed
out in Kelsey that in the 1881 case of In re MacKnight
(1891), 11 Mont. 126, 27 P. 336, then Justice Harwood,
writing for the Court, said that for more than 40 years, even
before we entered statehood, the jurisdiction of this Court
was not limited solely to such writs a.s may relate to the
exercise of its appellate jurisdiction.
An action for declaratory judgment is "provided by law"
as was noted in Lennon. It might be contended that a
declaratory judgment action is not one for the issuance of a
"writ." That contention would fa.vor form over substance.
The relief in this case, if Grossman were to be successful in
his contentions, would have the force and effect of a writ of
prohibition against the state officers. We therefore
determine that the rule in Lennon, which was applicable to
the 1889 Constitution, is equally applicable to the original
jurisdiction of this Court under the 1972 Montana
Constitution.
The factors described in Lennon are present here. In
the record of this case, we fin.d that the underwriters and
bond purchasers sought to obtain an unqualified legal opinion
from recognized bond counsel as to the legal validity of
bonds and the underlying security arrangements. Montana
lawyers had refused to issue an unqualified opinion, raising
several possible issues to be first determined, including
most of the issues raised in this case. The underwriters
have been advised by their counsel in writing that it would
be imprudent for the underwriters and the State to proceed
with the proposed water development program financing without
a conclusive resolution by this Court of all the relevant
1-egal issues relating to the bonds. Without a final decision
by this Court, the bonds are in effect unmarketable, or may
be sold only with an excessive premium. Even the time it
would take to begin this action in District Court and then
appeal to this Court is a major deterrent. If we should find
here constitutions 1 objections which would negate the
issuance of the bonds, decision by us now will be in
sufficient time to alert the legislature to such amendatory
provisions as may be necessary when it convenes in 1985.
We therefore hold that this Court does have original
jurisdiction to accept declaratory judgment proceedings where
the issues have impact of major importance on a statewide
basis, or upon a major segment of the state, and where the
purpose of the declaratory judgment proceedings will serve
the office of a writ provided by law, in accordance with Art.
VII, S 2(1), 1972 Mont. Const.
The second problem to be resolved if we are to accept
jurisdiction of this case is whether Grossman has standing to
sue. His complaint alleges that he is a citizen, resident,
elector, and taxpayer. In that stance, he is no different
than any other citizen, resident, el-ector, or taxpayer in
this state. He alleges no direct adverse impact on him by
virtue of the legislative enactments that would not be felt
by any other citizen, resident, elector, or taxpayer of the
state. In Chovanak v. Matthews (1948), 120 Mont. 520,
526-27, 188 P.2d 582, 585, we held:
"And the Supreme Court holds that to invoke
judicial power to disregard a statute as
unconstitutional, the party who assails it must
show, not only that the statute is invalid, but
that he has sustained, or is in immediate danger of
sustaining some direct injury as a result of its
enforcement, and not merely that he suffers in some
indefinite way in common with people generally.
(Citing cases. )

"The interest shown by appellant is only his
interest as a citizen, elector, taxpayer and
resident of Lewis and Clark County. This is the
same interest that the other citizens, electors,
taxpayers, and residents of the county have in the
matter, and it is not such interest as is permitted
to invoke the exercise of the judicial power of
determining whether an Act of the legislature is
violative of the Constitution."
The pronouncement in Chavanak was repeated in effect in
Stewart v. Board of County Commissioners (1977), 175 Mont.
197, 201, 573 P.2d 184, 186, where we said:
"From these cases we synthesize that the issue
presented for review must represent a 'case' or
'controversy' within the judicial cognizance of the
state sovereignty. Additionally, the following
minimum criteria are necessary to establish
standing to sue a governmental entity: (1) The
complaining party must clearly allege past, present
or threatened injury to a property or civil right;
and (2) the alleged injury must be distinguishable
from the injury to the public generally, but the
injury need not be exclusive to the complaining
party. "
Respondents have not objected to Grossma.nlscomplaint on
the ground that he has no standing. We noted, however, in
Stewart, that objections to standing cannot be waived and may
be raised by the court sua sponte. 175 Mont. at 204, 573
P.2d at 188. In view of the importance of the issues here,
we must specifically determine whether assuming jurisdiction
of Grossman's compl-aint is consonant with our laws and the
decided cases.
There is no question that this Court will recognize
standing in a taxpayer who is directly adversely affected by
a proposed assessment and levy of taxes upon him. State ex
rel. Conrad v. Managhan (1971), 157 Mont. 335, 338, 485 P.2d
948, 950.
Conrad was a class action where timberland owners were
directly affected by the refusal of 5 northwestern counties
to accept the amount of land valuation increases for tax
purposes mandated by the then State Board of Equalization.
There we held that a landowner had standing to bring a class
declaratory judgment action, and need not go to the extreme
of paying property taxes under protest and filing suit for
recovery. See also, State ex rel. Fulton v. District Court
(1961), 139 Mont. 573, 366 P.2d 435; Northwest Improvement
Companv v. Rosebud County (19551, 129 Mont. 41-2, 288 P.2d
657; Brophy Coal Company v. Matthews (1951), 125 Mont. 212,
233 P.2d 397.
The rule that a taxpayer must be directly adversely
affected to bring an action contesting the val-idity of state
bonds or the use of tax monies is not as unbendable as our
pronouncements in Chovanak and Stewart, make it seem. For
example in Huber v. Groff (1976), 171 Mont. 442, 558 P.2d
1124, we accepted original jurisdiction where the plaintiff,
a taxpayer, sought to have the Housing Act of 1975 declared
unconstitutional on several grounds. Huberls standing was
not discussed. In State ex rel. Ward. v. Anderson (1971), ,-58
Mont. 279, 491 P.2d 868, this Court accepted original
jurisdiction of an injunction proceeding to determine the
validity of bonds to be funded by tobacco taxes, income and
corporation license tax collections, and separate bonds to be
funded by a gasoline license tax. In Lodge v. Ayers (1939),
108 Mont. 527, 91 P.2d 691, this Court accepted the original
application of a taxpayer who contested the validity of
refunding a bonded indebtedness on which the state had
defaulted or was threatening to default by issuance of new
bonds. In Martin v. State Highway Commission (1939), 107
Mont. 603, 88 P.2d 41, an original application for injunction
to sustain the issuance of debentures funded by a tax on
motor fuels was accepted without discussion as to the status
of the plaintiff. There are other examples.
From these cases it will be seen that we must add a
further exception to the strictures on standing announced in
Chovanak and Stewart above. We will recognize the standing
of a ta.xpayer, without more, to question the state
constitutional validity of a ta.x or use of tax monies where
the issue or issues presented directly affect the
constitutional. validity of the state or its political
subdivisions acting to col.lect the tax, issue bonds, or use
the proceeds thereof. This is not to say we encourage
original. filings in this Court by taxpayers. The district
courts in most cases are open as the starting forum for many
of such controversies. It is when special circumstances,
presenting issues of an urgent or emergency nature, exist
requiring speedy determination, that we deem it wise to
accept original jurisdiction, and to recognize standing of an
ordinary taxpayer for that proceeding.
The urgent and emergency factors which excite our
acceptance of original jurisdiction here and drape the
taxpayer Grossman with standing are these: Grossman
challenges the constitutionality of various aspects of the
State's coal severance tax bond program; the State cannot
issue any of the proposed coal severance tax bonds authorized
by the legislature until the issues raised by the plaintiff
have been resolved by this Court; a District Court opinion is
.-
not sufficiently authoritative to provide underwriters and
investors with a final resolution of the constitutional
issues involved; unless we accept jurisdiction the issuance
of bonds will be delayed by several months if District Court
proceedings are required and the bonds are found valid; if we
do not accept jurisdiction and the bonds are not found to be
valid, the process of litigation may well go past the period
when the 1985 legislative assembly will convene, meet and
adjourn; and the health and welfare of a large segment of the
State's population may well be bettered if the bonds are
found valid and the proceeds used for the envisioned
projects.
From the economic viewpoint of the State as a whole,
from the viewpoint of the use of tax monies to develop water
resources, from the viewpoint of a legislative break from the
past in the constitutional use of State monies for the
improvement of the human condition of our residents, no more
important case has come before this Court. We hold ourselves
as a court to have authority over the subject matter and over
the parties.
We should without hesitancy recognize this case for what
it appears to be: a test case designed to obtain a final
judgment on the validity of coal severance tax revenue bonds
so that if valid, the bonds will be marketable. We will no
longer be qualmish about jurisdiction in a bond issuance
case. When the issues are fairly stated, fully explored and
vigorously contended, as they appear here, we have a
justiciable controversy suitable for final resolution by this
Court. Legal niceties must bend on occasion to the reality
of the market. The living law moves with the times.
We assume jurisdiction.

Montana taxes the production of coal within its borders
by imposing a tax on severance of coal ranging from 20% to
30% of value for strip mining, and 3% to 4% of value for
underground mining, the range depending in each type of
mining on the B.T.U. per pound of coal produced. Section
1.5-35-103, MCA.
Tax money produced by the severance of coal is allocated
to several purposes, section 15-35-108, MCA, but under our
state constitution 50% of the severance tax is dedicated to a
permanent trust fund, the interest and income from which may
be appropriated. The principal of the trust is inviolate
unless appropriated by a vote of three-fourths of the members
of each house of the legislature. 1972 Mont. Const., Art.
IX, 5 5.
Section 17-6-203(5), MCA, requires the separate
investment of the permanent coal severance tax trust fund;
but it also provides that the principal of the trust may gain
or lose if any part of the principal is appropriated by the
required three-fourths vote in each house.
In 1981, the legislature enacted Ch. 505, Laws of
Montana (1981) which a.ffects the principal of the permanent
coal severance tax trust. The act created three funds
within the trust, including a coal severance tax bond fund, a
coal severance tax permanent fund, and a coal severance tax
income fund. On December 31 and June 30 of each year the
State Treasurer must transfer into the coal severance tax
permanent fund all monies in the bond fund except amounts
necessary to meet principal and interest payments payable
from the bond fund on the next semiannual payment dates.
Section 17-5-703, MCA. More than three-quarters of the
members of each house supported the enactment.
The money flowing into the coal severance tax bond fund
comprises the constitutionally dedicated (50%) receipts from
the tax. Section 17-5-703, MCA. That fund is pledged to the
payment of principal and interest on all state-issued coal-
severance tax bonds. Section 17-5-705, MCA. The board of
eraminers was given authority upon approval of the
legislature to issue and sell coal severance tax bonds to
finance water development projects approved by the
legislature. Section 17-5-706, MCA.
The legislature is required by section 17-5-709, MCA, to
provide for "the continued assessment, levy, collection, and
deposit" into the bond fund of the coal severance tax
(apparently meaning the 50% constitutionally dedicated funds)
which, with funds from other sources, will be sufficient to
service the debt payments required by issued bonds.
The statutes go on to provide for the use of a fiscal
agent by the State, to authorize trust indentures and a
trustee, any trust company or bank with trust powers, to add
provisions for the protection of bondholders, and to provide
refunding. Sections 17-5-710 (4), 17-5-711, 17-5-712, and
17-5-716, MCA. The State is further pledged not to impair
bond obligations. Section 17-5-717, MCA. Nor may the total
of bonds issued for water resource development exceed $250
million. Section 17-5-719, MCA.
 We may explain the statutory scheme following the 1981
enactment thusly: The State will now deposit 50% of the coal
severance tax revenues in a bond account pledged to the
payment of State-issued bonds; monies which are not necessary
to meet upcoming bond payments will be transferred on
December 31 and June 30 of each year into the coal severance
tax permanent fund. When water projects are approved by the
legislature, and the issuance of coal severance tax bonds for
such projects is also approved by the legislature, the State
will issue and sell such bonds to obtain the proceeds
necessary for the water projects. The bonded indebtedness,
with interest thereon, will he paid for out of pledged coal
severance tax revenues, or such obligations may be refunded
in the future. When bonds are issued, each succeeding
biennial legislative assembly must appropriate to the coal
severance tax bond fund the monies necessary for the State to
meet its obligations under the bonds for the ensuing biennium
period. The obligation to appropriate such funds would not
change if the legislature were hereafter required to meet
annually.
Also included in Ch. 505, Laws of Montana (1 981) , was a
water development program, now codified in sections 85-1-601
to 623, inclusive, MCA. Its aim is to provide long-term
water development with financial and administrative
assistance. Here is created a water development state
special revenue fund (formerly an "earmarked fund") to
accumulate from various sources funds for the operation and
maintenance of State owned projects and works. Section
85-1-604, MCA.
Also created was a water development debt service fund
derived from 1%% of all coal severance taxes collected but
not otherwise allocated. Such fund may be used for grants
and loans to State and. local governments for water purposes.
Sections 85-1-603, and 85-1-605, MCA.
Grants and loans to private persons may be appropriated
out of the water development state special revenue account
established in section 85-1-604, MCA, under the authority of
section 85-1-606, MCA, up to 5 percent of said state special
account or 25 percent of the project cost, whichever is less.
Section 85-1-614, MCA.
The State is given a lien as security for any loan made
from the state special revenue account or water development
account. Section 85-1-615, MCA.
There are also provisions now in the code for the
issuance and sale by the State of water development bonds
upon authorization of a project by the legisla-ture,funded by
the water development debt service account, the source of
which is 1%% of the coal severance taxes. Sections 85-1-617,
and 85-1-619, MCA. The proceeds of the bonds may be used
only for loans in the water development. program. Section
85-1-618, MCA.
The coal severance tax monies which pour into the water
development debt service fund are kept separate from the
monies from other sources which pour into the water
development state special revenue fund., except that any
surplus of funds in the debt service fund above debt service
requirements then find their way into the state special
revenue fund, where these and other monies may be spent for
the purposes described in section 85-1-604, MCA.
With respect to bonds issued under the water development
program the legislature is again obligated to provide
sufficient funds from time to time as necessary to meet
promptly the full payment of principal and interest and
redemption premiums when due on all bonds payable from the
fund. Section 85-1-619, MCA.
The water development bond program outlined in Ch. 505,
Laws of Montana (1981), cumulated in the authorization by the
legislature for the issuance and sale of $5 million of water
development bonds for loans in the water development program.
Section 85-1-623, MCA.
Again the statutory scheme made be explained thusly:
I$% of the coal severance tax revenues will go into a debt

service fund for the purpose of funding and refunding the
issuance and sale of bonds for water development. The
proceeds of the sale of such bonds may be used only for loans
for water development projects. The legislature also
provided the accumulation of a state special revenue account
fund from other sources described in section 85-1-604, MCA,
but including the excess of the coal severance tax proceeds
not required for debt service. The funds in the state
special revenue account may be used for various projects
including grants and loans to State and local governments,
and grants and loans to private persons.
A further step taken by the legislature in 1981 was the
passage and approval. of House Bill 846. The lesislature
found that the Tonyue River Dam is in a dangerously unsafe
condition and needs repair and rehabilitation to prevent
washout, flood, damage to property and possible loss of life.
The legislature authorized, among other things, the issuance
of bonds not exceeding $10 million in total face value to be
funded and repaid from the coal severance tax permanent fund,
hereinbefore described, and found in section 17-5-703, MCA.
 In 1983, the legislature took further steps to provide

funds for various State water projects. In Ch. 705, Laws of
Montana (1983), it authorize@ the issuance of $45.35 million
for the development of hydropower potential at Painted Rocks
Dam, Broadwater Dam, and Cooney Dam; bonds not to exceed the
total sum of $551,900 for the repair and rehabilitation of
Yellow Water Dam in Petroleum County, Cottonwood Dam in Park
County, and Martinsdale Dam in Meagher and Wheatland
Counties; and $17,044,735 for loans to local government
entities, including cities, towns, counties, soil
conservation districts and irrigation districts, for 22

different water projects.
Thus, at the present time, the State has authorized the
issuance of state water resource development bonds, to be
financed and repaid out of coal severance tax revenues as
herein described up to the following amounts under the
following authorizations:
$ 5,000,000 Section 85-1-623, MCA
10,000,000 H.B. 846, Laws of Montana (1981)
45,350,000 Ch. 705, 5 3, Laws of Montana (1983)
551,900 Ch. 705, 5 4, Laws of Montana (1983)
17,044,735 Ch. 705, S 5, Laws of Montana (1983)

The 1981 legislature also included in its
appropriations, in H.B. 709, Laws of Montana (1981), a.
$350,000 appropriation to the Department of Na.tura1 Resources
and Conservation for the "small water projects construction
loan program" administered by the Department to be paid for
u.nder the water development program we have hereinbefore
described.
IV.

In S S 5 and 6, Ch. 705, Laws of Montana (19831, (H.B.

885) the legislature authorized the issuance of coal
severance tax revenue bonds in an amount not to exceed
$17,044,735 for the purpose of making loans from the bond
proceeds to 21 political subdivisions and local government
entities for 22 water development projects. Grossman
contends that this authorization violates 1972 Mont. Const.,
Art. V, § 12: "The legislature shall not pass a special or
local act when a general act is, or can be made, applicable."
Grossman contends that the appropriation of funds for
favorable loans to a score of small municipalities, water
districts and portions of a. county constitutes special
legislation, and is constitutionally invalid.
In presenting their arguments on this issue, all parties
rely on earlier cases of this Court, some decided under the
1972 Montana Constitution, and others under the 1889 Montana
Constitution. For the purposes of this opinion, we determine
that the respective provisions in the two constitutions are
essentially the same.
We would be skirting the issue if we did not readily
admit that the effect of § S 5 and 6, Ch. 705, Laws of Montana
(1983), is special or local. The 22 projects authorized for
loans under the bond program by the legislation relate to
particular municipalities or particular governmental
subdivisions on the basis of individual cases for less than a
class and apply to particular members of a class
particularized by the express terms of the act. Thus the
sections seem to come within the definition of "special law"
found in Sta.te e x rel. Powell v. State Bank of Moore (1931),
90 Mont. 539, 4 P.2d 717; State ex rel. Redman v. Meyers
(1922), 65 Mont. 124, 210 P. 1064. Yet we do not find S S 5
and 6, Ch. 705, Laws of Montana (1983), to be special or
local acts which are prohibited by Art. V, S 12.
 It is important to realize that the language of 1972
Mont. Const., Art. V, S 12, is not absolutely prohibitory.
The legislature is enjoined from passing a special or local
act only when a general act is or can be ma.de applicable. We
cannot imagine how the legislature could draft a general act
of state-wide application providing for the issuance and sale
of revenue bonds and at the same time keep a handle on the
way the bond proceeds are to be spent or loaned except
through its direct authorization of projects. This Court
faced a similar problem in State ex rel. Ford v. Schofield
(1917), 53 Mont. 502, 165 P. 594. There the legislature by a
single act created Carter County. The act creating the
county was attacked on the ground that it was special
legislation, since there was in effect at the time a general
statute providing for the organization and creation of new
counties. In upholding the power of the legislature to
create a single county where conditions had changed so as to
make the operation of the general a.ct inapplj-cable, this
Court also looked at the question under the constitutional
provision, who should decide whether a general law could be
made applicable, the courts, or the legislature? It decided:
"We believe there are many subjects of legislation,
which, from their inherent character, are subject
to regulation by general laws, and that the courts
are as advantageously situated as any other
department of government to say so; on the other
hand, there are certain subjects which may or may
not lend themselves to regulation by general laws,
depending upon extrinsic facts and circumstances
which the Legislature is peculiarly fitted to
ascertain and determine, but which the courts have
no means available to ascertain. Upon the first
class of subjects, the courts can and must
determine the applicability of general laws; upon
the second, the Legislature must be left free to
act." 53 Mont. at 510-11, 165 P. at 596.
The legislature stated its purpose and policy in
enacting Ch. 705, Laws of Montana (1983). It stated the
policy of Monta.na is to promote conservation, development and
beneficial use of the state's water resources to secure
maximum economic and social prosperity for its citizens. In
section 1(6), it made specific findings that the water
development projects to which objection is here made as local
or special would "implement the state's policy of full use,
conservation, and protection of its water resources." In
that light, the legislature here, by specifying projects
which it has authorized upon specific findings, is merely
implementing a general rule within the purview of the
constitution.
In Hotel Dorset Company v. Trust for Cultural Resources
of City of New York (1978), 46 N.Y.2d 358, 385 N.E.2d 1284, a
legislative act which provided support for financially
troubled museums in the state of New York was attacked upon
the ground that it benefited only the Museum of Modern Art in
the City of New York. The New York Court of Appeals held:
". . . If the subject matter of the legislation is
of sufficient importance to the State generally,
the legislation cannot be deemed a local law even
though it deals directly with the affairs of the
municipality. This has been an accepted principle
for many years, and there is ample showing from the
legislative findings alone that the maintenance of
cultural institutions is a State concern . . ."
385 N.E.2d at 1291.
The New York court also said:
"Courts are required to exercise a la.rgemeasure of
restraint when considering highly intricate and
imaginative schemes for public financing or for
public expenditures designed to be in the public
interest. Some may be highly controversial. But
when a court reviews such a decision, it must
operate on the rule that it may not substitute its
judgment for tha.t of the body which made the
decision. Judges, however much they might disagree
with the wisdom of the act under review, axe not
free to invalidate it on that ground.. ..
". . . We should not strain ourselves to find
illegality in such programs. The problems of a
modern city can never be solved unless arrangements
 like these . . . are upheld, unless they are
patently illegal . . ." 385 N.E.2d at 1289.
We regard the passage of Ch. 705, Laws of Montana
(1983), as an implementation of the water development policy
enunciated by the legislature and contained in sections
85-1-601 through 85-1-623, MCA. Section 85-1-605, MCA,
provides that loans and grants may be made to a "department,
agency, board, commission, or other division of state
government or to a city, county, or other political
subdivision or local government body of the state." No class
of government entity is excluded. Therefore the water
development financing program created by those statutes is
"generalw legislation within the meaning of 1972 Mont.
Const., Art. V, 5 12.
From either of two approaches therefore, we find that
the provisions of S S 5 a.nd 6, Ch. 705, Laws of Montana (1983)
are valid under Art. V, 5 12 of the 1972 Montana
Constitution. As an implementation of the water development
financing program, it is within the "general" legislation; as
a separately passed act authorizing loan from bond proceeds
for local projects, even though they may be local in effect,
these are provisions for which a general act can not be
provided.
Grossman does not directly attack the remaining
pr0~7isions of Ch. 705, Laws of Montana (1983), as having
local effect, although the remaining provisions relate to
hydroelectric development at three loca.tions, and to three
separate dams at other locations. To foreclose further
argument, let it be said that our result under the 1972 Mont.
Const., Art. V, § 12, would. be the same.
 Next Grossman attacks the validity of the 1egisla.tive
scheme that pledges each succeeding legislature to fund the
debt payments of principal, interest, redemption costs and
related expenses for the coal severance tax bonds. He
characterizes this as a "continuing appropriation" which
offends the intent, spirit and lancguage of the 1972 Mont.
Const., Art. IX, 5 5.
Specifically, Grossman charges that section 17-5-705,
MCA, which pledges the coal severance tax bond fund to the
payment of coal severance tax bonds; section 17-5-709, MCA,
which requires a continued deposit of coal severance tax
collections into the bond fund; section 17-5-719, MCA, which
limits such bonds to $250,000,000; and Ch. 705, Laws of
Montana (1983), (H.B. 885) violate the constitutional
provisions of Art. VIII, 5 s 8, 9, and 14, and Art. IX, S 5.
We set out the state constitutional provisions involved:
"ARTICLE VIII. Section -
8. State debt. No state
debt shall be created unless authorized by a
two-thirds vote of the members of each house of the
legislature or a majority of the electors voting
thereon. No state debt shall be created to cover
deficits incurred because appropriations exceeded
anticipated revenue.
"ARTICLE VIII. Section 9. Balanced budget.
Appropriations by the legisllture shall not exceed
anticipated revenue.
"ARTICLE VIII. Section 14. Prohibited payments.
Except for interest on tFe public debt, no money
shall be paid out of the treasury unless upon an
appropriation made by law and a warrant drawn by
the proper officer i n pursuance thereof.
"ARTICLE IX. Section 5. Severance tax on
coal--trust fund. The 1ecisla.ture shall d a c a t e
not less than one-fourth % of the coal severance
tax to a trust fund, the -interest and income from
which may be appropriated. The principal of the
trust shall forever remain inviolate unless
appropriated by vote of three-fourths (3/4) of the
members of each house of the legislature. After
December 31, 1979, at least fifty percent (50%) of
 the severance tax shall be dedicated to the trust
fund. "
In essence, Grossman is saying t.hat the 48th Legislative
Assembly which met in 1983 may not constitutionally bind the
49th Legislative Assembly and each succeeding legislative
assembly to "appropriate" the coal ta.x monies necessary to
service the State coal tax bonds; that the 48th Legislative
Assembly invaded the principal of the coal. severance tax
trust fund for yea-rs to come; and that each bond issue
requires a separate appropriation of the coal severance tax
revenues by a three-quarters vote of the members of each
house of the legislature.
Grossman builds his case around the state constitutional
provisions above, which limit each legislature to the
anticipated revenues in the budget period for legislative
appropriations, and the constitutional necessity of an
appropriation before a state warrant for money can be issued
against the appropriation.
Under the bond program it will certainly be the duty of
each succeeding legislature appropriate for the budget
period for which the legislative assembly is responsible,
sufficient monies within anticipated revenues, includ.ing
monies out of the coal severance tax fund, to service the
bonded indebtedness. Under the 1889 Montana Constitution, we
held the power of each 1egisla.tive assembly to bind the
following assembles in the matter of long-term public debt to
be clear:
"The next contention is that the Act violates
section 12 of Article XI1 of the [I8891
Constitution, which provides that 'no appropriation
of public money shall be made for a longer term
than two years.' The word 'appropriation' as there
used does not have application to a n Act providing
.
for the issuance of bonds or debentures, wherein
the Act creating the debt also levies a tax
 sufficient to pay the debt (State ex rel. Bonner v.
Dixon, supra). To hold otherwise would be to hold
that a bond issue could never extend over a period
of more than two years; because if a biennial
appropriation to retire such a debt is necessary,
the legislature would have the right to withhold
the appropriation, and therefore the law creating
the debt would, in effect, be repealable contrary
to the command of section 2, Article XIII. The
contention that the proceeds from the gasoline
license tax sufficient to retire the debentures
cannot be appropriated for more than two years is
untenable." Martin v. State Highway Commission et
al. (1939), 107 Mont. 603, 613, 88 P.2d 41, 46.

Under the 1889 Constitution, our Court used an escape
clause in that constitution to justify continued required
appropriations service long-term public debt. This Court
construed the word "appropriation" in the 1889 Constitution
to apply only to the general fund, and not to special funds
created by the legislature to retire the debt. State ex rel.
Bonner v. Dixon (1921), 59 Mont. 58, 195 P. 841. We do not
have the same language on which to rely in the 1972
Constitution. The result nevertheless must be the same.
In the construction constitutional provisions, we use
the same rules which are applicable to the construction of
statutes. Matter of McCabe (1975), 168 Mont. 334, 544 ~ . 2 d
825. In construing broad and general provisions of the
constitution which tend in measure to conflict with specific
ones, we are controlled by specific provisions, Jones and
Herriott v. Judge (1.978), 176 Mont. 251, 577 P.2d 846, and an
interpretation that achieves a reasonable result is favored,
State v. Gafford (1977), 172 Mont. 380, 563 ~ . 2 d 1129.
Neither statutory nor constitutional construction should lead
to absurd results, if reasonable construction will avoid it.
Billings Properties, Inc. v. Yellowstone County (1964), 144
Mont. 25, 394 P.2d 182. In determining the meaning of the
constitution, the Court must keep in mind that it is not the
beginning of law for the state, but a constitution assumes
the existence of a well understood system of law which is
still to remain in force and to be administered, but under
constitutional limitations. State ex rel. Hamshaw v. Justice
Court of Union Township (1939), 108 Mont. 12, 88 P.2d 1.
The 1972 Montana Constitution continues the financial
powers and duties imposed on the State by the 1889 State
Constitution. In short, each legislative assembly may make
appropriations for the coming budget period, which must not
exceed anticipated revenue. 1972 Mont. Const., Art. VIII, 5
9. No state debt may be created to cover deficits incurred
because appropriations may have exceeded anticipated revenue.
However state debt can be created by a two-thirds vote of the
members of each house, 1972 Mont. Const., Art. VIII, 5 8.
Money borrowed on behalf of the state must be used only for
the purposes specified in the authorizing law. 1972 Mont.
Const., Art. VIII, 5 11.
These constitutional provisions are easily harmonized.
The state must live within its means as to its general
expenditures, and must pay for new programs as it goes,
without incurring debt. But if a project or new program will
require the incurrence of debt, two-thirds of the members of
each house can authorize it. Since the constitution provides
for the use of borrowed funds, it undoubtedly follows that
the state could in fact borrow money or create indebtedness.
Incurrence of long-term debt through the issuance of bonds or
similar instruments is a time-honored method of governmental
financing at all levels. We hold it eminently clear that the
legislature can authorize borrowing long-term by issuing and
selling bonds, and can provide for the servicing for such
indebtedness by repayment or refunding.
 There is nothing inherently special about the coal
severance trust fund provided in Art. IX, S 5, or the terms
of that section, to insulate and make immune coal tax
revenues from use as a funding source for long-term state
bonds. Once three-quarters of the members of each house
approve, the state can validly issue bonds or other debt
instruments against coal tax revenues in the manner provided.
In the water resource development program adopted by two
sucessive legislatures, the 47th and 48th Legislative
Assemblies by proper vote, the legislature has the power to
invade the principal of the coal severance tax trust fund for
such purpose. When the legislature validly acts to establish
a debt under Art. VIII, 5 8, that i~debtedness becomes a
state obligation extending over the life of the indebtedness,
and every succeeding legislative assembly has an unavoidable
duty to provide for it, in the manner required by the
authorizing law. The provisions of the statutes herein
mentioned, and of Ch. 705, Laws of Montana (1983), (H.B.
885) , validly pledge the coal tax revenues so authorized for
the repayment of the bonded indebtedness, and validly bind
each succeeding legislative assembly to provide for their
repayment.
The legislature has provided us with a unique and
innovative water resource development program; but there is
nothing new or alien about funding public long-term state
bonds through dedicated revenues.
VI .
Grossman further argues that sections 17-5-701 through
17-5-719, MCA, Ch. 505, Laws of Montana (1981), (H.B. 8 4 6 ) ,
and Ch. 705, Laws of Montana (1983), (H.B. 885) contain a
pledge of money, an appropriation by the State and an
extension of state credit to pay bonds in the future although
said bonds are and will be created for a term of more than
two years. These provisions, he contends, violate the 1972
Mont. Const., Art. VIII, S 9: "Appropriations by the
legislature shall not exceed anticipated revenue."
Grossman contends that the constitutional framers
intended to continue the specific provision of the 1889 Mont.
Const., Art. XII, S 12, which provided in pertinent part:
"No appropriation of public moneys shall be made for a longer
term than two years."
We agree with Grossman that the intention of the
constitutional framers was that each legislative assembly
should appropriate only for the next budget period and that
such a.ppropriations should not exceed anticipated revenue for
such period. The reason that the framers of the 1972
Constitution did not include the clause "a longer term than
two years" was because when the 1972 Constitution was first
adopted it provided for annual instead of biennial sessions
of the legislature. In 1974, 1972 Mont. Const., Art. V, § 6,
was amended so that instead of a provision for meeting "at
least once a year," the legislature is now required to meet
"each odd-numbered year in regular session of not more than
90 legislative days." Constitutional Initiative No. 1.
We doubt that Grossman is serious that any legislative
assembly could not, under the 1972 Montana Constitution,
provide for public debt over a long term, and bind succeeding
legislative assemblies to appropriate monies to cover that
public debt. Such a construction would almost necessitate
the convening of another constitutional convention to make
specific such power. In any event, the matter was settled in
Martin v. State Highway Commission (1939), 107 Mont. 603, 88
P.2d 41, and what we have said earlier in this connection in
section V of this opinion covers our answer to this
contention. We find no merit in the constitutional attack on
the provision for binding succeeding legislative assemblies
to provide for the payment of the long term public debt.
VII .
Section 2, paragraph (2) of Ch. 705, Laws of Montana
(1983), (H.B. 885), authorizes the creation of state debt by
sale of coal severance tax bonds in an amount not to exceed
$45.35 million for the development of hydroelectic power at
three state-owned dams, Painted Rocks Dam, Broadwater Dam,
and Cooney Dam. Under sections 85-1-501 through 85-1-5u,
MCA, the Department of Natural Resources and Conservation
(DNRC) and the Board of Natural R-esources and Conservation as
governing board are mandated to make such hydroelectric
projects, when completed, available for lease to public
utilities and electric cooperatives or any Montana
corporation proposing use substantial portion the
electricity to be generated in its own operation. Section
85-1-502, MCA. If no lease applications are received or if
the board rejects all lease applications, the department
itself may operate the hydroelectric generation facility.
Grossman states that this offends 1972 Mont. Const.,
Art. V, S ll(5):
"No appropriations shall be made for religious,
charitable, industrial, educational, or benevolent
purposes to any private individual, private
association, or private corporation not under
control of the State."
We note that the legislature found that the
hydroelectric developments named here would implement the
State ' s policy of full use, conservation, and protection of
its water resources. Section l(6) (a), Ch. 705, Laws of
Montana (1983), (H.B. 885) .
The legislature also provided that the bonds may not be
issued by the Board of Examiners until the Roard of Natural
Resources and Conservation has determined that the projects
are feasible, and otherwise comply with the requirements of
law. Section 3(2), Ch. 705, Laws of Montana (1983), (H.B.
885).
Grossman contends that Art. V, § 11 of the 1972
Constitution is violated by these provisions which benefit,
he claims, the public utilities and the rural electric
cooperatives of the State, and possibly the "ABC Aluminum
Company" that might want to come in and use cheap power.
The constitutional provision is not violated because the
legislature may in making appropriations or other provisions
in some way benefit incidentally various private individuals,
associations or corporations not under the control of the
state. As long as the provisions relating to the
expenditures of the funds derived from the proceeds of the
bonds are under the control of the state, the constitutional
mandate is satisfied. Thus in Huber v. Groff (1976), 171
Mont. 442, 558 P.2d 1124, in construing the Housing Act of
1975, we found that even though the act directly benefits
banks and other lenders who sold mortgages to the Montana
Board of Housing, as well as builders of homes and
individuals who received low interest mortgages as a result
of that program, the Act was constitutional because the
Housing Board was not a private corporation, but a public
entity. "It received all of its powers directly from the
legislature and its duties and responsibilities are set out
clearly by the statute which created it." 171 Mont. at 457,
558 P.2d at 1132.
In State ex rel. Normile v. Cooney (1935), 100 Mont.
391, 47 P.2d 637, this Court held that the issuance of
revenue bonds by the State Water Conservation Board to
finance an irrigation and flood control project did not
violate a similar constitutional provision in the 1889
Montana Constitution though the project would benefit the
shareholders of a private water users association, because
the appropriation was made to an agency of the state and
thereby served a public use.
In this case, the funds derived from the sale of the
coal tax severance bonds, to the extent authorized, will be
expended by a state agency under the control of the state for
the construction of hydroelectric power projects. The
appropriations therefore are made for an agency of the state,
and not for a private person, association or corporation.
The fact that the state may afterwards lease completed
hydroelectric projects to a private association or
corporation is no more offensive constitutionally than is the
power of the state to lease its state-held lands to private
parties. There is no merit in Grossman's contention under
this section.
VIII.
Art. VIII, 1 of the 1972 Montana Constitution
provides: "Taxes shall be levied by general laws for public
purposes."
Grossman avers that the legislative plan of
appropriating $17 million from the proceeds of coal severance
tax bonds for loans to cities, counties, and other political
subdivisions or local governmental bodies violates Art. VIII,
S 1. He contends that the funds used to service a debt of
coal severance tax bonds are generated by the general taxing
powers of the state and that the funds will not be used for
public purposes but rather for financing special local
purposes.
These contentions are weightless. The question of
whether a particular purpose for which taxes may be levied
and collected is a public purpose is for the legislature in
the first instance, and the courts will indulge every
reasonable presumption of favor of the legislative decision
in this respect. Lewis and Clark County v. Industrial
Accident Board (1916), 52 Mont. 6, 155 P. 268. The words
"public purposes" are synonymous with "governmental
purposes." State ex rel. Mil-1s v. Dixon (1923), 66 Mont. 76,
90, 213 P. 227, 231.
The purposes for which these bonds are issued are set
out more fully in § 6, Ch. 705, Laws of Montana (1983), (H.B.
885). We need not repeat them here. It is enough to say
that for the most part the loans are authorized to provide
financial aid for city water systems, water distribution
systems, water supply treatment facilities, sewage treatment,
construction to provide reliable supplies of water, and plans
to alleviate water shortages. In one case a rural water
system is authorized where presently water must be hauled for
both domestic and stock water purposes. In each case the
legislature has found specificalllr the public purpose
involved, in some instances to resolve health hazards to the
residents being served, to prevent health problems, to
improve the quality of ground water, to improve the water
supply performance, and to stabilize water supplies.
 CORRECTION. In preparing this opinion for pub-
lication, we noted in our verification of titles and
Hon. John C. Sheehy citations the matters listed below. Corrections have
Justice, Supreme Court been made on our copy of the opinion.
Room 414 Justice Building
215 North Sanders
Helena, Montana 59620

Date:

Re: July 10, 1984
Grossman v. State Dept. of Natural Resources, No. 83-453, May 7,
1984

Page 32, line 7 --- Lumberman's Trust Co. v. Ryegate should read
Lumbermen's Trust Co. v. Ryegate.
Page 37, line 6 --- -
238 P.2d 316 should read 238 P. 316.

WEST PUBLISHING COMPANY
Box 3526
St. Paul, MN 55165
 It is clear that the purposes of the loans for which the
$17,044,735 is authorized affects the inhabitants of the
particular areas as communities, and not merely as
individuals. The use of the loan proceeds will clearly be
for public purposes. See Stanley v. Jeffries (1929), 86
Mont. 114, 284 P. 134; Hansen v. City of Havre (19411, 112
k-
Mont. 207, 114 P.2d 1053; Lumbermg'n's Trust Co. v. Ryegate
(9th Cir. 1932), 61 F.2d 14.
IX.

Art. V, S 1, 1972 Montana Constitution provides:
"The legislative power is vested in a legislature
consisting of a senate and a house of
representatives. The people reserve to themselves
the powers of initiative and referendum."

Grossman insists that section 3(2) of Ch. 705, Laws of
Montana (1983), (H.B. 885) delegates and grants to the Board
of Natural Resources and Conservation the power and authority
to determine the feasibility of the various water
conservation projects and to make recommendations on the
projects to the Board of Examiners. Grossman further
contends that such delegation is unconstitutional in that it
fails to set forth adequate standa.rdswith reasonable clarity
or to place any limits on the discretion of the Board, and as
such violates Art. V, S 1.
Section 3(2) is pointed toward the authorization of
$45.35 million of coal severance tax bonds to finance
hydroelectric power generating facilities at three state
owned dams. The bonds however may not be issued until. a
determination of "feasibility" is made by the Board:
" (2) Bonds approved in this section may not be
issued by the board of examiners until the board of
natural resources and conservation has determined
that a project is feasible and has otherwise
complied with the requirements of Title 85, chapter
 1, part 5, for the development of hydropower at
water projects under the control of the
department. "

It must be remembered that the legislature has also
found in Ch. 705, Laws of Montana (1983), that the water
development program is an integral part of the implementation
and development of a comprehensive, multiple use water
resources plan; and that the hydroelectic developments at the
three dams here implement the state's policy of full use,
conservation and protection of its water resources. All that
the legislature has done in (5 3(2), Ch. 705, Laws of Montana
(1983), is to add a proviso to its otherwise constitutional
authorization for bonds to the effect that feasibility under
Title 85, chapter 1, part 5, MCA, shall be determined by the
Board.
Contrary to the arguments of Grossman, there are
standards which impose with reasonable clarity limits on the
discretion of the Board in determining feasibility. These
are found in sections 85-1-501 and 85-1-502, MCA. Under
those statutes, the Department of Natural Resources and
Conservation is required to study the "economic and
environmental feasibility of constructing and operating" the
hydroelectric power generating facilities on each of the
water projects under its control and to update those studies.
The Department is to take into account the estimated costs of
construction, the estimated cost of maintaining, repairing
and operating the facility, the costs of tying into existing
power distribution channels, the ability of public utilities
or cooperatives to lease and operate such facilities, the
debt burden to be serviced, the revenue to be expected and
the likelihood of a reasonable return on the investment.
Once the Department has determined and made such studies, it
then becomes the duty of the Board of Natural Resources and
Conservation under section 85-1-502, MCA, to determine the
feasibility of a project and whether the project is in the
"best interest of the people of the state of Montana." What
the legislature has really done in the enactment of Ch. 705,
Laws of Montana (19831, and Title 85, chapter 1, part 5 is to
integrate executive duties with its 1-egislative
responsibility to make a workable whole in the development of
small scale hydroelectric power facilities for the public
good.
Here the enactments of the legislature are complete and
delegate to the Board of Natural Resources and Conservation
and the Department of Natural Resources and Conservation
administrative authority which is sufficiently clear,
definite and certain to enable the agencies to know their
respective rights and obligations. Huber v. Groff (1976),
171 Mont. 442, 558 P.2d 1124; Montana Milk Control Board v.
Rehberg (1962), 141 Mont. 149, 376 P.2d 508. Determinations
of economic and environmental feasibility are far more
appropriate in the administrative sector than in the
legislative branch. There is nothing improper,
constitutionally or otherwise, in the legislature making its
authorizations contingent upon administrative decisions
properly made in the executive side of the state government.
n.

We have already set out in section V. of this opinion,
the provisions of Art. VIII, S 14 and Art. IX, § 5 of the
1972 Montana Constitution.
In H.B. 846, Laws of Montana (1981), the legislature
a.uthorized issuance of not to exceed $10 million in coal
severance tax bonds for the State's share of the construction
costs of the Tongue River Dam rehabilitation. Grossman
attacks the authorization for such bonds upon the ground that
the amount of money necessary to finance the project is not a
definite or certain amount and therefore violates Art. VIII,
S 14, and Art. IX, 5 5.
The legislature found that the present Tongue River Dam
is in a dangerously unsafe condition because of an undersized
spillway; that a washout is possible from a flood which may
be expected every 68 years; that the dam almost failed during
a flood in the spring of 1978; and that a dam failure would
result in devastating property damage downstream to the
communities of Birney and Ashland. The legislature further
found that an enlarged Tongue River Dam that is jointly
funded by the federal government and the state government and
jointl-y managed by the Northern Cheyenne Tribe, the
Department of Natural Resources and Conservation, and the
federal government can provide a cost effective means of
preserving existing project benefits, provide water for
future agricultural and tribal use, preserve recreational
values and facilititate the negotiation of a compact between
the Tribe and the ~eserved
Water Rights Compact Commission
regarding tribal rights to water in the Tongue River.
At the time of the passage of the authorization for the
Tongue River Dam bonds, it was, of course, impossible for the
legislature to know the exact cost that the State might face
in the rehabilitation project. Therefore, it authorized an
issuance of up to $10 million of coal severance tax bonds as
the State's "share of the construction costs of the Tongue
River Dam rehabilitation" as established in a joint sharing
of project costs between the state, the federal government,
and the Northern Cheyenne Tribe. The authorization is
contingent upon legislative approval of a detailed project
plan approved by the Board of Natural Resources and
Conservation that includes a resolution of the Northern
Cheyenne Tribe's water right conflicts in the Tongue River
Basin, the appropriation of federal funds and a construction
project approved by the Board of Natural Resources and
Conservation and the legislature.
It should be recognized, though, that there are further
financial fences set about the appropriation. Although the
interest rate at which the bonds will be issued cannot be
projected, the bonds may not exceed 40 years in duration, and
may include provisions for redemption at earlier times.
Section 17-5-710, MCA. The Board of Examiners may not issue
coal severance tax bonds unless the aggregate amount of bonds
outstanding, including any approved issue and. any bonds
authorized but not issued can be serviced with no more than
two-thirds of the annual deposits into the coal severance
bond fund as determined by the average of the deposits during
the preceding three fiscal years. Section 17-5-709(2), MCA.
This is in addition to safeguarding provisions relating to
other sources of revenue.
Grossman bases his contention here on Art. VIII, § 14,
which states: "Except for interest on the public debt, no
money shall be paid out of the treasury unless upon an
appropriation made by law and a warrant drawn by the proper
officer in pursuance thereof." He contends that under State
ex rel. Dean v. Brandjord (1939), 108 Mont. 447, 92 P.2d 273,
a similar section of the 1889 Constitution was interpreted
and this Court held that while the precise figure might not
be nicely ascertained, there should he a maximum amount
contained in the authorization above which a warrant would
not be drawn. Grossman states there is no such maximum
contained in the acts under question.
In passing upon a similar objection in State ex rel.
Toomey v. State Board of Examiners (1925), 74 Mont. 1, 10,
238 P.M.316, this Court sa-id:
". . . by the provisions of the Act in question,
our legislative assembly exercised that power; the
amount of principal is definite; and, when the
treasury notes are sold, the rate of interest will
be fixed within the maximum provided in the Act.
Nothing is left then to the executive officers but
a. mathematical calculation. The rule that 'that is
certain which can be made certain' applies to
appropriations. (Citing authority.)"
In these days of fluctuating and sometimes volatile
interest rates, no legislative assembly can be expected to
project with any degree of confidence the interest rate which
will meet the market for the issuance of state bonds. The
cost of borrowed money appears to be beyond the control of
any of us. Yet when the bonds are issued and sold, the
interest rate to be paid by the State will become certain.
The principal will be definite; the amounts annually
necessary to service and repay the bond of indebtedness can
be ascertained. with mathematical precision. The rule applied
in Toomey above, "that is certain which can be made certain"
applies with full force here, and renders Grossman's
contentions respecting vagueness and indefiniteness
pointless.
XI.
Grossman alleges that H.B. 846, Laws of Montana (19811,
is not a complete appropriation and requires a further
three-fourths vote of each house of the legislature in order
to spend money from the constitutional trust fund as required
by 1972 Mont. Const., Art. IX, 5 5.
 Grossman does not enlarge upon these allegations in his
brief, nor does the State respond to the allegation.
If, in making the allegation, Grossman is contending
tha.t the Tongue River Dam Rehabilitation Bond Program,
authorized by H.B. 846, Laws of Montana (1981) is a
continuing appropriation which violates the constitution as
discussed by u s in section V above, we have already refuted
.
that contention. Grossman may mean, however, that under H.R.
846, the appropriation is not complete because the
authorization for the issuance of the bonds for the Tongue
River Dam rehabilitation requires a further a.pprova1 of the
project by the legislature. With that possible contention,
we do not agree.
The requirement for a three-fourths vote of the members
of each house of the legislature is found in 1972 Mont.
Const., Art. IX, § 5. It is a safeguard provision for use of
the trust principal or income from coal severance taxes.
H.B. 846 was approved by three-fourths of each house and is a
valid and final authorization for the issuance of the bonds.
We see no need for any further three-fourths vote. Once the
project is approved, the state's share established, and the
bonds issued, the legislature has effectively provided in a
con.stitutiona1manner for the issuance of such b0nd.s.
XII.
Lastly, Grossman contends that the appropriations of the
coal severance tax trust funds, the investment disbursements
to be made thereund.er, the holding of the proceeds of coal
severance tax funds by a trustee, and the use of the trust
funds bond proceeds, violate 1972 Mont. Const., Art. VIII, S§
12 and 13.
 In essence, section 12 requires that the legislature
insure strict accountability of all revenue received and
money spent by the State. Section 13 requires the
legislature to provide for a unified investment program for
all public funds with rules therefor, including supervision
of investment of such funds.
Grossman's a-ttack with respect to strict accountability
is apparently directed at section 17-5-711, MCA, which allows
the Board of Examiners to appoint a trustee, which may be any
trust company or bank having the powers of a trust company,
by means of a trust indenture. However, the succeeding
statute, section 17-5-712, MCA, provides that the trust
indenture may set forth such rights and remedies of the bond
holders as is customa.ry in trust indentures and may include
provisions for protecting and enforcing the rights and
remedies of the bondholders, including covenants setting
forth the duties of the State, the Board of Examiners, and
the departments or agencies in the state government in
relation to the acquisition, construction, improvement,
maintenance, operation, repair, and insurance of the projects
involved, and for the custody, safeguarding and application
of all money.
In Huber, this Court approved an act which authorized
the Montana Board of Housing to issue bonds secured by a
trust indenture between the Board and a corporate trustee.
We adhere to the discussion respecting the unified investment
program in that case where we said:
"The Constitution's provision for the unified
investment fund does not require that all agencies
participate regardless of the nature of the agency.
Where, as here, the agency is not using state funds
and is setting up what amounts to its own
specialized investment fund with a particular
purpose, it is reasonable to allow, as the
 legislature did, the agency to take care of its own
funds in a manner appropriate to its function."
171 Mont. at 460, 558 P.2d at 1133.
We hold that the provisions made for the issuance for coal
tax severance bonds for water resource development do not
violate the "strict accountability" provision nor the unified
investment provision of our Constitution.
XIII.
Section 85-1-623, MCA, enacted as section 1, chapter
507, Laws of Montana (1981), authorizes the issuance of not
more than $5 million of water development bonds. These bonds
are to be distinguished from the coal severance tax bonds
which are authorized in Ch. 705, Laws of Montana (1983), and
H.B. 846, Laws of Montana (1981). Although the wa-ter
development bonds are secured by a portion of the coal
severance tax monies, section 85-1-603 (2), MCA, the sources
are separate from the trust monies from coal severance taxes
that are covered by 1972 Mont. Const., Art. IX, § 5.
Grossman does not directly attack the validity of the
water development bonds, though reference to the $5 million
authorization contained in H.B. 846 has been made in briefs
and in oral argument. Grossman's legal attack in his
pleadings and his brief has been focused totally on the coal
severance tax bonds, authorized under Ch. 705, Laws of
Montana (1981); and H.B. 846, Laws of Montana (1981) relating
to bonds for the Tongue River Dam. We have therefore
confined our discussion in this opinion to the attacks made
by Grossman on the coal severance tax trust fund bonds.
XIV.
b26 It is, therefore, our conclusion and holding that the
bonds proposed to be issued and sold by the State under the
provisions of Ch. 705, Laws of Montana (1983), H.B. 885, Laws
of Montana (1981) and under H.B. 846, Laws of Montana (1981),
relating to the Tongue River Dam, are valid enactments by the
legislature, constitutionally provided for and safeguarded.
We hold in favor of the defendants and against the plaintiff
Ray Grossman on each and all particulars of the plaintiff's
complaint and enter declaratory judgment in favor of the
defendants. This opinion, without the filing of further
instrument or order sha.11 be and constitute a declaratory
judgment to that effect.

We Concur:

Chief Justice