Case Name: STATE OF NORTH DAKOTA EX REL. A. P. LENHART v. L. B. HANNA et al.
Court: North Dakota Supreme Court
Jurisdiction: North Dakota
Decision Date: 1914-10-28
Citations: 28 N.D. 583
Docket Number: 
Parties: STATE OF NORTH DAKOTA EX REL. A. P. LENHART v. L. B. HANNA et al.
Judges: 
Reporter: North Dakota Reports
Volume: 28
Pages: 583–597

Head Matter:
STATE OF NORTH DAKOTA EX REL. A. P. LENHART v. L. B. HANNA et al.
(149 N. W. 573.)
Revenue — taxes — assessment — levy — educational Institutions — constitution;
1. The legislative assembly by various acts has assumed to levy taxes to raise revenue for the maintenance of certain educational institutions and for other purposes, and by chapter 148, Laws 1913, it levied a tax of 1J mills on each dollar of the assessed valuation of all taxable property in the state for the maintenance of certain designated educational institutions. Section 174 of the state Constitution directs tire legislative assembly to provide for raising revenue sufficient to defray the expenses of the state for each year, not to exceed in any one year 4 mills on the dollar of the assessed valuation of the property in the state. Pursuant to such constitutional mandate the legislature, by §§ 1531 and 1538, Rev. Codes 1905 (§§ 2141 and 2148, Comp. Laws 1913), designated the state board of equalization as the agency for levying state taxes, but limited its powers to the “amount necessary to raise for the purpose of meeting the appropriations made by the legislative assembly and the estimated general expenses of the state as made by the auditor.”
The state board of equalization at its 1914 meeing, which has not adjourned, assumed to levy 3 mills for the purposes designated in said statute, and but 1 mill in addition to meet the special levies made by the legislature in the various acts aforesaid, leaving but a fraction of a mill for the educational institutions. It is held that in doing so the board exceeded its powers in that it attempted to impose a tax to raise revenue greatly in excess of that required to meet appropriations made by the legislature and the estimated general expenses of-the state. It is also held that such excess, if eliminated, will enable the board, within the 4-mile limit, to levy the full amount for the educational institutions provided for in chapter 148.
Statute — constitutionality.
2. The question of the constitutionality of chapter 148, Laws 1913, not decided for reasons stated in the opinion.
Limit of taxation — constitution.
3. Section 174 of the Constitution, fixing the limit of taxation for state expenses at 4 mills, was intended to thus limit the raising of revenue for all state purposes whatever, excepting for the purpose of paying the interest on the state debt.
Board of equalization — amount of state levy — past appropriations — anticipated appropriations.
4. Sections 1531 and 1538, Rev. Codes 1905 (§§ 2141 and 2148, Comp. Laws 1913), construed, and held, to limit the state board of equalization, in making the state levy, to an amount necessary to meet past appropriations made by the legislature and the estimated general expenses of the state; and in assuming to make provision for meeting anticipated appropriations to be made in the future, the board exceeded the powers delegated to it.
Purpose for which a tax may be levied — legislative function — cannot be delegated.
5. Defining the purpose for which a tax may be levied is the exclusive function of the legislative assembly, and such function has not been, nor can it be, delegated to any board or person.
Additional Syllabus on Rehearing.
Pacts assumed by counsel — erroneous — appropriations in excess of revenue — board of equalization — levy for taxation purposes — must be within limit — must reduce appropriations within limit.
6. It appearing on rehearing that the undisputed facts are the reverse of those which were by counsel, through error and inadvertence, assumed to be correct on the first hearing, and that in the light of such newly discovered facts the appropriations greatly exceed the revenue which can be raised by a levy within the constitutional limit of 4 mills, it is the imperative duty of the board, in levying the state taxes, to deduct from certain appropriations a sum sufficient to bring the total within the maximum limit thus fixed.
Reductions — rule for making — brandies of state government — penal institutions — insane and feeble minded — other appropriations reduced pro rata.
7. In making such reductions from the various appropriations the following rule should be followed: In making such levy the board should provide in full only for those appropriations covering the expenses of maintaining the three co-ordinate branches of the state government, and those for the penal institutions and for the insane and feeble minded. All other appropriations, both standing and special, should be reduced on a pro rata basis to such sum as will bring the total appropriations within the eonstitutionanl 4-mill limit.
Opinion filed October 28, 1914.
On Rehearing November 12, 1914.
Application for an original writ of mandamus, directed to the respondents as members of the state board of equalization, commanding such board to revise and correct its levy of state taxes so as to include in such levy 1-J mills for the educational institutions, as prescribed in. chapter 148, Laws 1913.
Writ granted.
Newton, Dullam, & Young, for relator.
Andrew Miller, Attorney General, John Carmody, Alfred Zuger, Assistant Attorneys General, for respondents.

Opinion:
Fisk, J.
Application on due notice is made to this court by a resident citizen and taxpayer for a writ commanding the respondents, as members of the state board of equalization, to correct and readjust its levy of state taxes so as to include therein 1-J mills for the educational institutions of the state, pursuant to the special levy for such purposes made by the legislative assembly in chapter 148, Laws 1913. Such board levied but 1 mill to meet all the special levies made by the legislature, leaving but a fraction of a mill for the educational institutions as apportioned by such board. The board attempts to justify its action in so doing upon the grounds:
1st. That the acts attempting to make such special levies are unconstitutional, and,—
2d. That such reduction was necessary in order to bring the total levy for state purposes within the constitutional limit of 4 mills as provided by § 174 of the state Constitution, which reads:
"The legislative assembly shall provide for raising revenue sufficient to defray the expenses of the state for each year, not to exceed in any one year four (4) mills on the dollar of the assessed valuation of all taxable property in the state, to be ascertained by the last assessment made for state and county purposes, and also a sufficient sum to pay the interest on the state debt."
We do not pass upon the constitutionality of such special levy statutes, for -the reason that such point is not pressed by respondents' counsel, and at the oral argument was practically abandoned by them. Furthermore, all the beneficiaries under these statutes are not before the court, and it would be unfair to them to adjudicate such question in their absence. Moreover, some of these special levy statutes have been in operation for many years, and their validity has never been questioned. It is also, at least, doubtful as to the right of respondents, as members of the state board of equalization, to raise such question at all, and especially in these proceedings.
Following the well-settled rule that courts will not inquire into the validity of a statute except when it is imperative so to do, we refrain from doing so in this case, but in passing we cannot refrain from observing that respondents' contention on this point is, in any event, apparently inconsistent with their action in levying a fraction of a mill for such purposes.
The petitioner, on the other hand, is, we think, clearly in error in his contention that the constitutional limit of 4 mills as fixed in § 174, supra, does not apply to levies for educational purposes. If such contention be sound, there is no limit to the rate of taxation except with reference to raising revenue sufficient to defray the expenses of the three co-ordinate branches of the state government, the executive, legislative, and judicial. In employing the language, "the • legislative assembly shall provide for raising revenue sufficient to defray the expenses of the state for each year, not to exceed in any one year four (4) mills on the dollar," etc., the framers of the Constitution clearly intended to thus limit the raising of revenue for all purposes whatsoever, except that mentioned in the last clause of the section; and this is the holding of the Colorado court under a similar constitutional provision. People ex rel. Thomas v. Scott, 9 Colo. 422, 12 Pac. 608; Re Appropriations, 13 Colo. 316, 22 Pac. 464; People ex rel. State University v. State Board, 20 Colo. 220, 37 Pac. 964. It would, indeed, be strange if it was intended to limit the raising of revenue necessary for keeping the state government in operation, and yet leave a free hand as to all other purposes. Is the maintenance of the educational institutions more important than the maintenance of the state government itself ? Clearly not.
Is respondents' second ground of justification, as above stated, tenable ? A correct answer to this question involves a consideration of certain questions of fact as well as law. It is conceded that the actual and necessary expenses of maintaining the three branches of the state government, viz., the executive, legislative, and judicial, must be taken care of in preference to all other expenses. In view of this concession, which is undoubtedly correct, and also in view of our holding as above stated, that 4 mills is the limit of taxation for all state purposes, it necessarily •follows that the levy for other purposes, even though directed to be made by specific and valid acts of tbe legislature, must be postponed or reduced to the extent, if any, that such specific levies would, when added to those necessary for raising the required revenue for the maintenance of the state departments, exceed the 4-mill limit. Is there any such excess to be thus'dealt with?
This brings us to a consideration of the question whether in making such levy the board erroneously included items of revenue not necessary to be raised for the purpose of meeting the appropriations made by the legislative assembly and the estimated general expenses of the state as made by the state auditor. The power of levying taxes is, of course, a legislative power, to be exercised within the limits of the constitutional provision, § 175 of the state Constitution, which provides: "No tax shall be levied except in pursuance of law, and every law imposing a tax shall state distinctly the object of the same, to which only it shall be applied."
By § 1531 and 1538, Bev. Codes 1905, being § 2141 and 2148, Comp. Laws 1913, the legislature designated the state board of equalization as the agency for levying state taxes. The latter section, among other things, provides: "In levying said tax the state board of equalization shall be limited by the amount necessary to raise for the purpose of meeting the appropriations made by the legislative assembly and the estimated general expenses of the state, as made by the auditor, . . . provided, that if the amount is greater than the rate prescribed in the Constitution will raise, then the state auditor shall only certify the limited rate."
It will thus be seen that the authority of the board is limited by law, in making such levy, to an amount necessary to meet past appropriations made by the legislature and the estimated general expenses of the state. Such language is, we think, too clear for debate, and that thereunder the board has no power to include in its levy items deemed necessary to meet anticipated future appropriations. It is equally clear that the words "estimated general expenses" were intended to include merely the ordinary expenses pertaining to the maintenance of the three branches of the state government, and for which the legislature has provided standing appropriations. To otherwise hold would in effect be deciding that no limitation whatever, except the constitutional limitation of 4 mills, was intended to be imposed by the legislature. If 2 mills only were required to cover all appropriations, including standing as well as special appropriations, then if the defendant's contention is sound, the board could levy the additional 2 mills for no specific purpose, or for a purpose which it might deem proper, and the legislature could thereafter appropriate the revenue raised, to any purpose, or not appropriate it at all. This would be violative of § 175 of the state Constitution above quoted.
Defining the purpose for which a tax shall be levied is the exclusive function of the legislature, not the board of equalization or the state auditor; and this function cannot be delegated; and no tax can be levied unless the purpose therefor has been first specified by the legislature.
Tested by the above rules it is clear that the board exceeded its powers. The undisputed facts disclose that the board included one item of $171,800 to meet future contemplated appropriations of an extraordinary character, also other items of a similar nature. If such items are eliminated, the 4-mill limit will not interfere with the special levy of 1-& mills made by chapter 148, Laws 1913, for the maintenance of the state educational institutions.
We are amply supported in the above views by the supreme court of Colorado in the following cases decided under constitutional and statutory provisions very similar to those in this state: People ex rel. Thomas v. Scott, 9 Colo. 422, 12 Pac. 606; Re Appropriations, 13 Colo. 316, 22 Pac. 464; People ex rel. State University v. State Board, 20 Colo. 220, 37 Pac. 964; Nance v. Stuart, 12 Colo. App. 125, 54 Pac. 867, and cases cited; Parks v. Soldiers' & S. Home, 22 Colo. 86, 43 Pac. 542; Denver v. Adams County, 33 Colo. 1, 77 Pac. 858; See also Chicago & N. W. R. Co. v. State, 128 Wis. 553, 108 N. W. at p. 576 of opinion.
The writ will issue as prayed for by the relator.