Case Title: C & P Telephone v. Director of Finance

Citation: 343 Md. 567

Docket Number: 97/95

State: maryland

Court: Maryland Supreme Court

Date: 1996-10-09T00:00:00Z

Document:
THE CHESAPEAKE AND POTOMAC TELEPHONE COMPANY
OF MARYLAND, ET AL.  v. DIRECTOR OF FINANCE
FOR THE MAYOR AND CITY COUNCIL OF BALTIMORE
NO. 97, SEPTEMBER TERM, 1995
HEADNOTE:
TAXATION - CUSTOMER AND DEMAND CHARGES INCLUDED IN THE PETITIONERS'
MONTHLY ELECTRIC BILLS ARE PART OF THE "GROSS SALES PRICE" OF
"SALES FOR CONSUMPTION" OF ELECTRICITY WITHIN THE MEANING OF
ARTICLE 28, § 55(A)(1) OF THE BALTIMORE CITY CODE, AND THUS SUBJECT
TO THE 8% TAX IMPOSED ON SUCH SALES.
IN THE COURT OF APPEALS OF MARYLAND
NO. 97
SEPTEMBER TERM, 1995
___________________________________
THE CHESAPEAKE AND POTOMAC
TELEPHONE COMPANY OF MARYLAND, ET 
AL.
V.
DIRECTOR OF FINANCE FOR THE MAYOR
AND CITY COUNCIL OF BALTIMORE
___________________________________
Murphy, C. J.
Eldridge
Rodowsky
Chasanow
Karwacki
Bell
Raker
     
    
JJ.
___________________________________
OPINION BY BELL, J.
___________________________________
      FILED:  October 9, 1996
We granted certiorari in this case to consider whether,
pursuant to Baltimore City Code (1983 Repl. Vol. & 1993 Cum. Supp.)
Article 28, § 55(a)(1), a tax levied on the "gross sales price" of
"sales for consumption" of electricity applies to certain charges
on the petitioners' monthly electric bills that do not vary in
proportion to the amount of electricity consumed.  On motion for
summary judgment, the Maryland Tax Court concluded that the charges
at issue were not "sales for consumption" of electricity, and,
therefore, the City ordinance did not provide for their taxation.
The Circuit Court for Baltimore City affirmed the Tax Court's
decision.  On appeal, the Court of Special Appeals reversed the
judgment of the circuit court.  Director of Finance v. Charles
Towers, 104 Md. App. 710, 657 A.2d 808 (1995).  At the petitioners'
request, we granted the writ of certiorari.  We shall affirm the
judgment of the intermediate appellate court.
I.
The facts in this case are largely undisputed; indeed, most
were stipulated by the parties.  Ordinance 745 of the Mayor and
City Council of Baltimore, approved December 23, 1946, was enacted
for the purpose of taxing, during 1947, inter alia, all sales for
consumption for nonresidential uses of artificial or natural gas
and electricity delivered in Baltimore City.  Subsequently,
2
     As originally enacted, the ordinance provided:
1
Section 1.  Be it ordained by the Mayor and
City Council of Baltimore, That during the
year 1947, there is hereby levied and imposed
on all sales for consumption, except as made
under the residential schedules applicable to
the City of Baltimore on file with the Public
Service Commission of Maryland (designated
schedules R. City, D. City and DH) of
artificial or natural gas and electricity
delivered in Baltimore City through pipes,
wires or conduits and on all sales of service
for the transmission of messages by
non-residential telephones within the limits
of Baltimore City, billed in 1947, a tax at
the rate of five percentum (5%) upon the
gross sales price thereof.  Every person,
firm, or corporation making any such
deliveries or sales within the City of
Baltimore shall collect said tax from the
purchasers of said products or services and
report the same, under oath, on or before the
15th day of the succeeding calendar month to
the City Collector, upon forms to be supplied
by him, and pay to the City Collector the
amount collected from the said purchasers
during the preceding calendar month.  The tax
imposed by this ordinance shall not apply to
sales to the United States, the State of
Maryland or the City of Baltimore, or any
agency of any of them, nor shall it apply to
hospitals, churches, charitable institutions
Ordinance 108 continued the tax for the succeeding years 1948-51.
It was codified in the Baltimore City Code at Article 37, §76.
Thereafter, Ordinance 88, permanently prescribing the utilities
tax, was approved  November 20, 1951.  Although that provision has
been amended frequently since 1951, including its scope, the
portion relevant to this appeal has remained essentially
unchanged.    Now codified in Article 28, § 55 provides, in
1
3
and other non-profit organizations.
 
The City Collector is hereby authorized
to adopt such rules and regulations as may be
necessary to insure the collection of the tax
imposed by this ordinance.
Sec. 2. And be it further ordained, That any
person, firm or corporation refusing or
failing to comply with the provisions of this
ordinance, or making a false statement or
improper return, and any purchaser of such
products or services refusing to pay the tax
imposed by this ordinance, shall be guilty of
a misdemeanor and upon conviction thereof, be
subject to a fine of not more than Five
Hundred Dollars ($500.00) for each such
offense.
Sec. 3.  And be it further ordained, That
this ordinance shall take effect from the
date of its passage.
pertinent part:
(a)(1) 
Artificial 
or 
natural 
gas,
electricity, and steam rates.  There is hereby
levied 
and 
imposed 
on 
all 
sales 
for
consumption of artificial or natural gas,
electricity and steam delivered in Baltimore
City through pipes, wires or conduits within
the limits of Baltimore City, hereinafter
referred to as "energy sales," and billed
after the effective date hereof, a tax at the
rate of 8% upon the gross sales price thereof.
The monthly electricity bills the taxpayers received from BGE
contained separately stated charges for each component of the gross
sales price of electricity as required by the Public Service
4
     According to the PSC, the reason the different cost
2
components are not combined into a single commodity price is
because a multi-part rate allows a utility's total costs involved
in production and sale of electricity to be fairly allocated
among the various classes of customers it is obliged to serve. 
Affidavit of Alan D. Hames, PSC Director of Rate Research &
Economics Division.
     In the case of residential customers, and non-residential
3
customers with monthly electricity demands of less than 60
kilowatts, all costs, including the customer and demand charges,
are included as part of the energy charge.  The rate schedule
applicable to the taxpayers in this case is Schedule GL, General
Service Large - Electric, which is used only where a customer has
established a monthly demand of 60 kilowatts or more.
Commission ("PSC").   Accordingly, the total bill for electricity
2
sold to the taxpayers included the following charges:
(1) Customer Charge - is designed to recover
metering, billing, and other administrative
costs of BGE associated with the production,
transmission, 
distribution 
and 
sale 
of
electricity.  It is billed based on a fixed
monthly rate.
(2) Demand Charge - is designed to recover the
costs associated with the equipment and
facilities needed to produce, transmit, and
distribute electricity.  It is billed by first
identifying the half-hour during the month in
which a consumer's use of electricity was
greatest, as measured in kilowatts, and then
multiplying the number of kilowatts consumed
by a fixed dollar amount.
(3) Energy Charge - is based on total energy
consumption during the month in kilowatt
hours.[3]
(4) Fuel Rate Charge - is designed to recover
BGE's fuel costs related to the electricity
sold by it.  It is calculated by multiplying
total kilowatt hour usage for the billing
period by the dollar amount of the current
5
     The taxpayers' bills also included an electric
4
environmental surcharge as mandated by Maryland Code, Natural
Resources Art. § 3-302, and a Maryland sales tax.
     BGE collected the tax at issue as an agent for the City. 
5
It then forwarded the monies collected each month to the City
Finance Department.
fuel rate.[4]
The City sales tax, pursuant to Art. 28, § 55(a)(1), was collected
on the aggregate of the monthly customer charge, demand charge,
energy charge and fuel rate charge.  
In 1991, each of the petitioners in this case, C & P Telephone
Co., Santoni's Inc., Charles Towers Partnership, Apartment
Services, Inc., and United Holdings Co. Inc. ("the taxpayers")
filed separate claims with the respondent, the Director of Finance
for the Mayor and City Council of Baltimore ("the Director") for
refund of the 8% utility tax paid on the customer and demand
charges for which Baltimore Gas & Electric ("BGE") billed them over
the preceding three years.    The customer and demand charges,
5
unlike the energy and fuel rate charges, were not calculated based
on the actual amount of electricity consumed.  Therefore, the
taxpayers contended that these charges were not "sales for
consumption" and should not be taxed.
After six months elapsed with no determination from the
director as to the validity of their claims, the taxpayers,
pursuant to Maryland Code (1957, 1994 Repl. Vol.) Article 24, § 9-
712(d)(2) and Maryland Code (1988, 1996 Cum. Supp.), § 13-510(b),
6
     Article 24, § 9-712(d)(2) provides:
6
(2) If a tax collector does not make a
determination on a claim for refund within 6
months after the claim is filed, the claimant
may:
(i) Consider the claim as being disallowed;
and
(ii) Appeal the disallowance to the Tax
Court.
Section 13-510(b) of the Tax General Article provides:
(b) Exception when no action taken on claim
for refund. - If a tax collector does not
make a determination on a claim for refund
within 6 months after the claim is filed, the
claimant may:
(1) consider the claim as being disallowed;
and
(2) appeal the disallowance to the Tax Court.
     Upon filing his answer, the Director requested and was
7
granted by the Tax Court, postponement of consideration of the
taxpayers' claims pending the outcome of Baltimore County v. Blue
Circle Atlantic, No. 1504, Sept. Term, 1991 (June 25, 1992),
cert. denied, 328 Md. 92 (1992), in the Court of Special Appeals. 
In that case, the Tax Court held that § 11-60 of the Baltimore
County Code, which, as to sales of electricity, is virtually
identical to the Baltimore City ordinance, was not properly
imposed on customer and demand charges paid by the claimants, and
thus ordered refunds.  Baltimore County v. Blue Circle Atlantic.
Md. Tax Ct. Misc. Nos. 684-688 (Aug. 15, 1990).  The Court of
Special Appeals affirmed that decision in an unreported opinion. 
Blue Circle, supra.
The Baltimore County ordinance provides, in pertinent part:
(a) Pursuant to the power and authority
contained in § 11-15 of this Code, there is
hereby levied and imposed on all sales for
consumption of electricity delivered in the
county, through wires or conduits, a tax at
the rate of seven and one-half (7.5) percent
of the Tax-General Article  treated the claims as denied and
6
appealed to the Maryland Tax Court.   In that court, all parties
7
7
on the gross sales thereof, subject to the
provisions of subsection (b) of this section.
 Baltimore County Code, § 11-60(a) (1978 & Supp. 1988-89).
     The amounts to be refunded to the taxpayers were as
8
follows:
C & P Telephone Co.
$
152,205.37
Charles Towers Partnership
$ 
16,196.34
Baltimore Budget Hotel Partnership
$  
4,107.47
Apartment Services, Inc.
$  
6,906.93
United Holdings Co.
$ 
45,337.99
Santoni's Inc.
$  
5,113.94    
filed motions for summary judgment, along with supporting
affidavits.  Because each of the taxpayers' motions addressed the
same issue, the Tax Court consolidated them for hearing.  Finding
no genuine dispute as to any material fact, and persuaded by its
reasoning in Baltimore County v. Blue Circle Atlantic, Misc. Nos.
684-688 (Aug. 15, 1990), the Tax Court granted summary judgment in
favor of the taxpayers.  It determined, as a matter of law, "[t]hat
Article 28, § 55(a)(1) of the Baltimore City Code (the 'City
Ordinance') does not authorize the assessment and collection of the
public utilities tax on 'demand charges' and 'customer charges' as
those charges are not sales of electricity actually consumed."
Therefore, on December 14, 1993, the Tax Court ordered the Director
to refund with interest to the taxpayers the taxes they paid on
such charges.   The Director sought judicial review in the Circuit
8
8
     The Director sought judicial review in three cases:  (1) C
9
& P Telephone Co., (2) Charles Towers Partnership, Baltimore
Budget Hotel Partnership, Apartment Services, Inc., and United
Holdings Company, Inc., and (3) Santoni's Inc.  The cases were
consolidated by the circuit court.
     Section 55(d) provides:
10
Regulations - The Director of Finance is
hereby authorized to adopt such rules and
regulations as may be necessary to insure the
collection of the tax imposed by this section
and to define any terms used in this section.
Court for Baltimore City.   After a hearing on the merits, that
9
court held that:
[T]he findings of the Tax Court are correct.
It is the language of the statute that
convinces me.  [I]t just doesn't make common
sense to apply any other language to this
other than sales of electricity which is
actually consumed....  So ... I'm mak[ing] a
finding that the order of the ... Tax Court is
hereby affirmed.
Thereafter, the Director appealed to the Court of Special
Appeals, arguing, inter alia, that the plain and unambiguous
meaning of the City Ordinance required inclusion of the customer
and demand charges in the "gross sales price" on which the
ordinance imposes the tax, and that the Tax Court and the circuit
court failed to accord due deference to the administrative
construction of the statute by the Director as authorized by
Baltimore City Code, Art. 28, § 55(d).10
The Court of Special Appeals reversed the judgment of the
circuit court.  Director of Finance, supra, 104 Md. App. at 730,
657 A.2d at 818.  Although it did not find the ordinance to be
9
     The conditional cross appeal was filed on the issue of
11
whether the ordinance plainly and unambiguously required "the
inclusion of customer and demand charges as components of the
gross sales price of electricity sold to the taxpayers, to which
the statutory 8% rate is to be applied."
     In the present appeal, the petitioners Charles Towers
12
Partnership, Baltimore Budget Hotel Partnership, Apartment
Services, Inc., United Holdings Co. Inc., and Santoni's Inc.,
have adopted by reference the entire brief filed by the
petitioner C & P telephone Co., pursuant to Maryland Rule 8-
503(f).  That rule states:
"plain and free from ambiguity," id. at 715, 657 A.2d at 811, the
intermediate appellate court nevertheless held that the phrase
"sales for consumption" meant "retail sales" of electricity,
specifically, those purchases made by the ultimate consumers of the
electricity, as opposed to those purchases made "for the purpose of
reselling electricity to other consumers."  Id. at 718, 657 A.2d at
812.  The correctness of its interpretation of the phrase was
confirmed, the court stated, by the Director's administrative
interpretation of the ordinance, which was "entitled to significant
weight."  Id. at 722-23, 657 A.2d at 815.
The taxpayers petitioned for certiorari and the Director filed
a conditional cross petition.  Although we granted both the
taxpayers' petition and the Director's conditional cross petition,11
our resolution of the issue the taxpayers raise makes consideration
of the conditional cross appeal unnecessary.
II.
A.
In their brief, the taxpayers  contend that the Tax Court
12
10
Incorporation by Reference. -- In a case
involving more than one appellant or
appellee, any appellant or appellee may adopt
by reference any part of the brief of
another. 
     The grant of summary judgment is reviewed to determine
13
"whether the trial court was legally correct."  Heat & Power
Corp. v. Air Products & Chemicals, Inc., 320 Md. 584, 591, 578
A.2d 1202, 1206 (1990) (citations omitted), See Hartford Ins. Co.
v. Manor Inn, 335 Md. 135, 144, 642 A.2d 219, 224 (1994); Beatty
v. Trailmaster Products, Inc., 330 Md. 726, 737, 625 A.2d 1005,
1011 (1993).
correctly interpreted the ordinance as imposing the electricity tax
only on charges based on the amount of electricity actually
consumed, namely, the energy and fuel rate charges.  They maintain
that the Tax Court's interpretation of the ordinance comports with
the rules of statutory construction.  In this regard, they submit
that the Tax Court first concluded that the language of the
ordinance was clear and unambiguous and then "simply applied the
ordinary meaning of those words."  Thus, the taxpayers conclude
that the Tax Court's decision was legally correct.13
The taxpayers further maintain that the Court of Special
Appeals "reweigh[ed] and reinterpret[ed]" the facts in this case
and then applied its own construction of the law to those facts.
As evidence of such behavior, the taxpayers point to, inter alia,
the intermediate appellate court's decision to give significant
weight to the City's long-standing administrative practice of
treating the ordinance as a tax on retail sales of electricity.
Id. at 721-22 & n.5, 657 A.2d at 814 & n.5.
11
     In deciding this case, we need not address the issue of
14
the City's long-standing administrative practice relative to the
ordinance because we find it to be plain and unambiguous.  See
e.g., Falik v. Prince George's Hosp., 322 Md. 409, 416, 588 A.2d
324, 327 (1991) "([W]hen statutory language is unambiguous,
administrative constructions, no matter how well entrenched, are
not given weight."); Macke Co. v. Comptroller, 302 Md. 18, 22,
485 A.2d 254, 257 (1984) (same).
The 
taxpayers 
contend, 
however, 
that 
despite 
this
administrative practice, the only evidence in the record
demonstrating such an application of the tax is the affidavit of
Ottavio Grande, the City Collector.  In that affidavit, Mr. Grande
stated that the City does not, nor has it ever, collected
electricity taxes from a waste processing facility known as
Baltimore Refuse Energy Systems Co. ("BRESCO"), because BRESCO is
not the ultimate consumer of electricity, but rather a reseller.
Nevertheless, the taxpayers argue that this affidavit is wholly
insufficient to demonstrate that the City made its taxability
determinations based on whether the transaction was retail or
wholesale in nature.14
Finally, the taxpayers contend that this Court's holding in
Controller v. Pleasure Cove, 334 Md. 450, 639 A.2d 685 (1994), in
which we interpreted Anne Arundel County's so-called "boat slip
tax," is "equally applicable to this tax on the consumption of
electricity."  Accordingly, the taxpayers argue that, just as in
Pleasure Cove, where the boat slip rental charge was separately
stated on the bill from the charges for other marina services, and
in which we held that the County was not authorized to impose the
12
     According to the Director, the "gross sales price"
15
includes all of the charges that cover BGE's costs of producing,
transmitting and selling electricity, along with the monetary
return authorized by the PSC.
boat slip tax on the charges for those other services, 334 Md. at
461, 639 A.2d at 691, the customer and demand charges in the
instant case are for something other than the subject of the tax.
In addition, the taxpayers note that, as in Pleasure Cove, the tax
at issue is not a general retail sales tax, but rather a tax on a
specific item, namely, sales for consumption of electricity.  On
this basis, the taxpayers conclude that, inasmuch as customer and
demand charges are not sales for consumption, the imposition of the
electricity tax on them "exceeds the scope of the taxing statute."
B.
On the City's behalf, the Director contends that the taxpayers
have muddied the distinction between the subject of the tax and the
method by which the amount of tax is calculated.  The subject of
the tax, according to the Director, is "sales for consumption of
... electricity."  He thus points out that it is undisputed that
the taxpayers consumed all of the electricity BGE sold them.  As to
the calculation of the tax, the Director, also citing Pleasure
Cove, supra, 334 Md. at 461-63, 639 A.2d at 691-02, maintains that
customer and demand charges are an integral part of the "gross
sales price"  of electricity because "they cover [a] part of the
15
cost of producing, transmitting and selling electricity that is
covered by no other component of the price charged by BGE for the
13
electricity purchased and consumed by [the taxpayers]."  He
concludes, therefore, that the manner in which the components of
the gross sales price are calculated has no bearing on whether
there is a sale for consumption of electricity.
Consequently, the Director submits that the Tax Court's
decision was premised on an erroneous conclusion of law, there
being no support in the text of the ordinance for the taxpayers'
contention that, to be taxable, every component of the gross sales
price must vary directly with the amount of electricity sold.  As
the Director sees it, the City Council's purpose in emphasizing
that the gross sales price was to be taxed at a stated rate "was to
make clear that every component of the price of electricity sold
for consumption was to be included in that amount."  The
Respondent's Brief at 24.
The Director also notes, as did the Court of Special Appeals,
that for residential customers and non-residential customers with
a demand of less than 60 kilowatts, all costs of providing
electricity are included in the energy rate.  Director of Finance,
supra, 104 Md. App. at 720, 657 A.2d at 813.  Accordingly, he
asserts, the term "gross sales price" should not encompass fewer
costs of providing the taxpayers in this case with electricity than
it does for providing electricity for consumption by residential
customers or non-residential customers with a demand of less than
60 kilowatts.
III.
14
As is customary in statutory construction cases, we begin our
analysis by reviewing the pertinent rules.  Of course, the cardinal
rule is to ascertain and effectuate legislative intent.  Oaks v.
Connors, 339 Md. 24, 35, 660 A.2d 423, 429 (1995); Montgomery
County v. Buckman, 333 Md. 516, 523, 636 A.2d 448, 451 (1994);
Condon v. State, 332 Md. 481, 491, 632 A.2d 753, 755 (1993).  To
this end, we begin our inquiry with the words of the statute and,
ordinarily, when the words of the statute are clear and
unambiguous, according to their commonly understood meaning, we end
our inquiry there also.  Oaks, supra, 339 Md. at 35, 660 A.2d at
429; Buckman, supra, 333 Md. at 523, 636 A.2d at 451; Condon,
supra, 332 Md. at 491, 632 A.2d at 755; Harris v. State, 331 Md.
137, 145-46, 626 A.2d 946, 950 (1993).
Where the statutory language is plain and unambiguous, a court
may neither add nor delete language so as to "reflect an intent not
evidenced in that language," Condon, supra, 332 Md. at 491, 632
A.2d at 755, nor may it construe the statute with "'forced or
subtle interpretations' that limit or extend its application."  Id.
(quoting Tucker v. Fireman's Fund Insurance Co., 308 Md. 69, 73,
517 A.2d 730, 732 (1986).  Moreover, whenever possible, a statute
should be read so that no word, clause, sentence or phrase is
rendered superfluous or nugatory.  Buckman, supra, 333 Md. at 524,
636 A.2d at 452; Condon, supra, 332 Md. at 491, 632 A.2d at 755.
Applying these principles to the case sub judice, we are of
the opinion that the Tax Court, in interpreting Art. 28, §
15
55(a)(1), reached its result based on an erroneous conclusion of
law.  Consequently, we are "under no statutory constraints in
reversing [it]."  Ramsay, Scarlett & Co. v. Comptroller, 302 Md.
825, 834, 490 A.2d 1296, 1301 (1985); Supervisor of Assessments v.
Carroll, 298 Md. 311, 318, 469 A.2d 858, 861 (1984); Comptroller v.
Mandel Re-election Committee, 280 Md. 575, 578, 374 A.2d 1130,
1131-32 (1977).
As we have seen, the Tax Court, in its summary judgment orders
issued in favor of the taxpayers, found, as a matter of law, that
§ 55(a)(1) "does not authorize the assessment and collection of the
public utilities tax on 'demand charges' and 'customer charges' as
those charges are not sales of electricity actually consumed."
(Emphasis added).  In reaching this conclusion, however, the Tax
Court imported language into the ordinance that impermissibly
altered its meaning.  Condon, supra, 332 Md. at 491, 632 A.2d at
755.  Nowhere in § 55(a)(1) does it state that the tax is to be
levied on sales of electricity for "actual" consumption.  Rather,
it clearly states that the tax is to be imposed on "all sales for
consumption."  In our view, the operative word in that phrase is
"sales," as that is the unit of consideration on which the City
Council imposed the tax.
Having thus established that "sales" of electricity for
consumption are the taxable event under § 55(a)(1), to be taxable,
a sale needs only to be "for consumption," (emphasis added), not
actually consumed.  In the instant case, it is undisputed that the
16
     Webster's New World Dictionary of the American Language
16
617 (2d ed. 1980) defines the word "gross" as "total; entire;
with no deductions[.]"
sales of electricity were for consumption.  Clearly then, as the
Director quite correctly notes, the manner in which the components
of the gross sales price are calculated has no bearing on whether
a sale is for consumption.
Section 55(a)(1) plainly states that the 8% tax is levied on
the "gross sales price" of "all sales for consumption."  That being
so, we agree with the Director and the Court of Special Appeals
that by using the adjective "gross" to modify the phrase "sales
price," the City Council evidenced an intent to tax the entire
sales price.   Director of Finance, supra, 104 Md. App. at 723, 657
16
A.2d at 815.  To be sure, construing the ordinance in the manner
the taxpayers suggest, namely, so as to tax some, but not all, of
the components of the sales price would effectively render the word
"gross" unnecessary, a result which is not consonant with the rules
of statutory construction.  Buckman, supra, 333 Md. at 524, 636
A.2d at 452, Condon, supra, 332 Md. at 491, 632 A.2d at 755.
Because we have concluded that the ordinance clearly requires
the taxation of the entire sales price, and because even the
taxpayers themselves concede that customer and demand charges are
"part of the total price charged for the provision of electricity,"
it follows that the customer and demand charges are part of the
gross sales price to which the 8% tax rate is to be applied.  The
17
     See Re Baltimore Gas and Electric Co., 73 PSC 6 (1982)
17
(discussing the establishment of the electricity rate schedules
the PSC authorizes BGE to file).  See also supra note 3.
fact that BGE bills separately identify and specify the various
components of the utility's costs in providing electricity to the
class of customers to which the taxpayers belong, including its
fixed costs, does not change the fact that the sales, as a whole,
are for consumption.  In addition, as the Director also points out,
the only reason that all components are not combined into a single
commodity price, as they are for residential customers and non-
residential customers with monthly demands of less than 60
kilowatts, is because the PSC has required a multi-part rate so as
to allocate fairly costs among BGE's various customer classes.17
In sum, we believe our decision in this case is compelled by
the plain, unambiguous language of the statute.  Although we arrive
at the same ultimate result, in this respect, our analysis differs
from that of the Court of Special Appeals.  See Director of
Finance, supra, 104 Md. App. at 718, 657 A.2d at 812.  Like that
court, however, we too are persuaded that this Court's opinions in
Baltimore Country Club v. Comptroller, 272 Md. 65, 321 A.2d 308
(1974), and Pleasure Cove, likewise dictate this result.  The
analysis applied in those cases confirms the result dictated by the
words of the statute.  See Prince George's County v. Vieira, 340
Md. 651, 658, 667 A.2d 898, 901 (1995); Mayor & City Council of
Baltimore v. Cassidy, 338 Md. 88, 98, 656 A.2d 757, 762 (1995);
18
     The Retail Sales Tax Act is now codified in Maryland Code
18
(1988, 1996 Cum. Supp.), § 11-101 et seq. of the Tax General
Article.  When our opinion in Baltimore Country Club v.
Comptroller, 272 Md. 65, 321 A.2d 308 (1974) was issued, the Act
was codified in Maryland Code (1969 Repl. Vol.) Article 81, § 324
et seq.
State v. Thompson, 332 Md. 1, 7, 629 A.2d 731, 732 (1993). 
Baltimore Country Club dealt with the Maryland Retail Sales
Tax.   That statute defined a retail sale as, inter alia "the sale
18
of any meals, food or drink for human consumption on the premises
where sold."  272 Md. at 66, 321 A.2d at 309.  Baltimore Country
Club, the petitioner in the case, for many years had added to its
stated price for the food and beverages served to its members, and
collected on behalf of its employees, a 15% mandatory gratuity or
"service charge."  The Comptroller of the Treasury considered these
service charges to be part of the "price" of the Club's retail
sales.  Therefore, the Comptroller levied a sales tax against the
Club for the amount of all the service charges.  On appeal,
agreeing with the Comptroller, we explained:
[I]n making sales of food and beverages to its
members, service is always provided by the
Club as an integral part of the transaction.
The mandatory service charge imposed by the
Club as part of the sale is a legally binding
contractual obligation upon the purchaser, one
"automatically and invariably" levied and
required to be paid as a constituent part of
the "price" of the sale.
Id. at 73, 321 A.2d at 312.  In the instant case, as in Baltimore
Country Club, the customer and demand charges are "an integral part
of the transaction" of selling electricity to the taxpayers for
19
     The taxpayers' effort to distinguish Baltimore County
19
Club, from the instant case on the ground that in Baltimore
Country Club the tax was a general retail sales tax, whereas in
this case, as in Controller v. Pleasure Cove, 334 Md. 450, 639
A.2d 685 (1994), the tax is levied on a specific item, namely,
sales for consumption of electricity, is unavailing.  As we see
it, the unit of consideration for purposes of applying the tax is
of primary importance, while the nature of the tax, i.e.,
specific or general, is a secondary consideration.
     As explained in Pleasure Cove, 334 Md. at 453 n.1, 639
20
A.2d at 687, n.1, a boatel is "a building containing multi-tiered
racks on which the boats are stored."
consumption.  These charges constitute part of the "legally binding
contractual obligation" the taxpayers entered into upon purchasing
electricity from BGE.19
We contrast the result in Baltimore County Club with our more
recent decision in Pleasure Cove.  That case, as we have seen,
concerned the scope of Maryland Code (1957, 1990 Repl. Vol.)
Article 24, § 9-602, which authorized Anne Arundel County to
collect a tax on "space rentals" for the storage or docking of
boats ("boat slip tax").  In addition to membership dues, Pleasure
Cove Yacht Club charged its members a fee for boat slip rentals,
outside storage space or boatel rentals.   Prior to 1989, the fee
20
included the cost of certain marina services, such as electricity,
trash removal, ice removal, security, etc.  The entire rental fee
was subject to the boat slip tax.  In 1989, Pleasure Cove concluded
that marina services were not taxable.  Therefore, Pleasure Cove
began charging separately for the marina services, applying the tax
only to the remaining rental fee.  The County Controller's Office
20
subsequently decided that the marina services should have been
subject to the boat slip tax.  Siding with the taxpayers, we
pointed out that:
With regard to the Baltimore Country Club
case, 
restaurant 
service 
is 
inherently
necessary to the sale of restaurant meals and
is usually not optional.  Thus, the price of a
meal typically reflects the cost to the
restaurant of serving the meal.
The marina services involved here, on the
other hand, are not inherently necessary to
the wet slip, outside rack, or boatel rental.
Boat slip renters are capable of performing
the marina services on their own and quite
often do.
334 Md. at 462-63, 639 A.2d at 691-92.
Thus, in contrast to Baltimore County Club and the instant
case, the marina services were not "inherently necessary" to the
provision of boat slip rentals.  In this case, however, it is
undisputed that the charges at issue are not for something other
than electricity; rather, they are separately stated components of
the price of electricity, the sale of which is the taxable event.
Being mindful of the principles we enunciated in Baltimore
Country Club and most recently in Pleasure Cove, we conclude that
Art. 28, § 55(a)(1) contemplates the inclusion of customer and
demand charges within the "gross sales price" of "sales for
consumption" of electricity to which the 8% tax rate is applicable.
JUDGMENT AFFIRMED, WITH COSTS.