The Detroit times. [volume] (Detroit, Mich.) 1903-1920, 1913-05-22
All Judges Agree as to Legality
of Immediate Effect Clause
of Verdier Act
BONDING PROVISION
is CAUSE OF SPLIT
Haley Holds Increase in Limit
for Acquiring Public Utility
Violates Constitution

cision TO dismiss the petition G
George II. Barbour. Fred T. Mora
and Charles a. Ducharme for an II
junction to restrain Mayor Marx fror
naming u street railway board unde
the municipal ownership amendment
adopted by the voters or Detroit las
April. All the judges agree that tn
cetition should be dismissed. bu
there il difference OF opinion a
TO certain phases OF the constitution
atty OF the Verdier act under While
the amendment was submitted
Three points were raised in the lit
cation az follows:
Was the bill introduced by Sen.
ator Verdier, Jan. 81, 1913. print
ed as required by section % Of
article Ave of the constitution?
Was il lawful for the legislature
to give to the bill on its passage
Immediate effect in accordance
with section Il Of article five OF
the constitution?
Does the act In question violate
those provisions OF the constitu-
ton which limit the debt creating
power OF cities?
was printed as required by the con
stitution. and that the necessity 20
Immediate passage Is a question 70
the legislature rather than the courts
but the split comes on the question
Of the raising OF money 10 pay 70
the proposed municipal traction sys
tenn.
Judge Hally. In an exhaustive opip
ION, takes the ground that the al
thority conferred on the city by TN
Verdier act 10 increase its bohdini
limit by two per cent OF its assesse'
valuation for the requirement OF an,
public utility is violation OF the con
stitution His opinion follows II
part:
A study Of the debate in the
constitutional convention, indi-
Gates that 1t at least was the in.
tention OF the trainers Of the con-
sutution that the faith and the
credit Of any municipality was 10
(, be pledged for this class Of a
public utility only insofar as
there was n margin between It's
existing debt and tho maximum
fixed by the legislature for It's
bonded Indebtedness. Nowhere
In the constitution or In the de-
bate does ii appear that IL was
the purpose OF that instrument TO
authorize the legislature TO per
init cities TO acquire, own. and
operate this utility OH moneys
secured upon the faith and credit
of the city. Ii the legislature OF
1918. may authorize two per cent
OF the bonded Indebtedness Of the
city TO be pledged for such a
utility successive legislation may
increase this TO any amount, so
that the whole sum necessary Tor
the acquiring of the utility would
be a charge upon the faith and
credit OF the city. II such was
the intention OF the constitution,
Section "a Of Article s was ali un-
necessary enactment and what
was designed for a potential
force becomes an active one with
the success OF the utility depen-
dent rather upon the ability OF
the city TO collect taxes than to
properly manage the enterprise.
With the design SO clearly en-
pressed that ii was the province
OF a city TO utilize the difference
between it's existing Indebtedness
and its maximum limit for this
purpose and get the balance out
OF the utility itself and the fran
chise given for it's operation il be-
comes clear that the bill insofar
as II permits the limit TO be In
creased for this purpose and for
this purpose only Ia an invasion
Of the constitutional provisions.
And insofar as II permits II, the
portion that does 80, is void
The bill should be dismissed,
because the single point on which
compliments are sustained Is not
SUFFICIENT for the reasons given
to grant any of the relief prayed
for. In this connection II must be
borne In mind that II Is the legis-
lation attempted In Lansing that
is here considered, The many
interesting questions which nec-
essarily arise from the local leg.
islation enacted by the resident
electors we're not argued and are
not now considered. This opin-
ion Is without prejudice as to
any OF these questions.
The majority opinion written b
fudge Hosmer and concurred In b
Judges Van lille and Mandell follow
In part:
am unable to find anything in
the constitution which prevents
the legislature from giving cities
l. the authority to use the borrow
ing power between the debt and
general limit of bonded Indebted
ness for this purpose. In leaving
|. to the legislature the bonding
limit. the constitution has empow-
cred that body 10 open the door
to the purchase Of public utilities
ON the credit OF the city " II sees
ut and the holding OF the act un-
constitutional in nowise tends 10
present this. The legislature
may raise the limit SO that the
margin is sufficient. Subject TO
the restriction that city's debt
must not exceed eight per cent OF
the assessed value OF property ex-
elusive OF special assessment dis
trict bonds. and ten per cent In.
elusive of all bonds, subject TO the
provision that the charter OF a
city shall not be changed by In
creasing the limit Of its Indebted
ness oftener than once In two
years, and subject TO the further
provision that no single increase
shall exceed two per cent. city
may use any borrowing power
which remains, not exceeding two
per cent, for street railroad pur-
chase or installation -