Opinion ID: 2634847
Heading Depth: 3
Heading Rank: 1

Heading: Whether the County Appellees Are Municipalities Under Utah Code Section 76-10-915(1)(f)

Text: ¶ 15 The Summit Water appellants argue that the district court's interpretation of the word municipality in section 76-10-915(1)(f) to include a county, a special service district, and a private California corporation is contrary to settled principles of statutory construction, which require reliance on a word's plain meaning unless there is ambiguity. They contend that the term plainly refers to municipal corporations only  in other words, cities and towns  and that such an interpretation is in accord with a general mandate to interpret exemptions from antitrust laws narrowly. ¶ 16 The County appellees respond that the term municipality is ambiguous on its face when considered in light of conflicting definitions of the term in other statutory enactments. Furthermore, in their view, the context in which the municipality exemption was added to the Antitrust Act, together with the Antitrust Act's direction in section 76-10-926 to refer to federal law when interpreting the Act, indicates an intent by the legislature to include all units of local government within the exemption. They further contend that a narrow interpretation of the term would lead to conflict between the Antitrust Act and the Interlocal Cooperation Act, Utah Code Ann. §§ 11-13-101 to -314 (2003 & Supp.2004), insofar as the latter authorizes the creation and continuing existence of the Intermountain Power Agency (IPA), an entity formed through the cooperation of twenty-three Utah cities and towns for the purpose of constructing and operating the Intermountain Power Project (IPP). ¶ 17 It is well settled in this court that our goal when interpreting a statute is to give effect to the legislative intent, as evidenced by the [statute's] plain language, in light of the purpose the statute was meant to achieve. Foutz v. City of S. Jordan, 2004 UT 75, ¶ 11, 100 P.3d 1171 (internal quotation omitted). When evaluating the plain language of a particular statutory provision, we interpret it in harmony with other statutes in the same chapter and related chapters. Mountain Ranch Estates v. Utah State Tax Comm'n, 2004 UT 86, ¶ 11, 100 P.3d 1206 (internal quotation omitted). However, [i]f we find ambiguity in the statute's language, we look to legislative history and other policy considerations for guidance. ExxonMobil Corp. v. Utah State Tax Comm'n, 2003 UT 53, ¶ 14, 86 P.3d 706. ¶ 18 Here, the parties' dispute over the interpretation of the term municipality in section 76-10-915(1)(f) implicates the broader question of how ambiguity in a statute's language is to be identified. As indicated above, the district court originally determined that the word municipality unambiguously referred only to cities and towns. In its May 27, 2002 order, the court repeated that, in the absence of the legislative history materials submitted by the County appellees, it would continue to adhere to that conclusion. Its ultimate decision to the contrary was entirely based on the additional materials submitted that, in the district court's view, indicated a legislative intent that was not apparent on the face of the statute itself. ¶ 19 We first consider whether we agree with the district court that the term municipality, on its face, unambiguously refers only to cities and towns. The district court concluded that [n]owhere has this court been able to find a definition or use of the term `municipality' in Utah statute or constitution that, from its plain meaning, one could read as anything other than a city. Or, conversely, that one could stretch to embrace a county or its special service district. Based on our examination of the Utah Code and Constitution, there is no question that the word municipality is used almost exclusively to refer to municipal corporations  cities and towns. It is true, as the County appellees point out, that the former Utah Municipal Bond Act explicitly defined municipality to include[] cities, towns, counties, school districts, public transit districts, and improvement districts ..., special service districts ..., metropolitan water districts ..., irrigation districts ..., water conservancy districts ..., and regional service areas. Utah Code Ann. § 11-14-1(1) (2003) (repealed 2005). The provision clarified that that definition applied only for the purpose of th[e] [Municipal Bond Act]. Id. The County appellees urge us to consider this definition as sufficient indication that the word municipality is ambiguous on its face. However, the fact that the legislature in 2005 saw fit, when amending the Act, to replace the term municipality with the term local political subdivision, see ch. 105, 2005 Utah Laws § 9 (codified at Utah Code Ann. § 11-14-102(3)), may suggest the legislature's own acknowledgment that the former broad definition of municipality was not in accord with the term's generally accepted meaning. ¶ 20 The only other instance in which a Utah Code provision defines the term municipality to include any county ... or political subdivision of this state is in section 72-10-301(4) of the Aeronautics Act, Utah Code Ann. §§ 72-10-101 to -504 (2001 & Supp.2004). A review of the Aeronautics Act in its entirety suggests that this definition was inserted only to simplify the later definition of public agency in the same provision, see id. § 72-10-301(6) (including municipalities in the definition of public agency), for, despite the inclusion of counties in that definition of municipality, other provisions in the same part of the chapter list both counties and municipalities in a manner that suggests they are separate entities, see id. §§ 72-10-303, -304. ¶ 21 If our review were restricted to the occurrences of the word municipality in the Utah Code and Constitution, we would be inclined to agree with the district court that the term on its face unambiguously refers only to municipal corporations. We do not end our analysis here, however, because, as the County appellees point out, the Antitrust Act expressly provides that [t]he Legislature intends that the courts, in construing this act, will be guided by interpretations given by the federal courts to comparable federal antitrust statutes and by other state courts to comparable state antitrust statutes. Id. § 76-10-926. Based on this direction, we must examine antitrust law as a whole in order to determine whether the term municipality means something other than a municipal corporation when used in the antitrust context. ¶ 22 The federal antitrust law, the Sherman Act, exempts local governments from damage and attorney's fee penalties for federal antitrust violations. 15 U.S.C. § 35(a). The Act defines local government as including a city, county, parish, town, township, village, or any other general function governmental unit established by State law, id. § 34(1)(A), as well as a school district, sanitary district, or any other special function governmental unit established by State law in one or more States, id. § 34(1)(B). The Sherman Act thus uses the term local government to mean what the County appellees argue the term municipality means in the Utah statute. These provisions therefore do not support the County appellees argument. Congress, however, added these provisions to the Sherman Act in 1984, Local Government Antitrust Act of 1984, Pub.L. No. 98-544, 98 Stat. 2750 (1984) (codified at 15 U.S.C. §§ 34-36), and the County appellees argue that Congress made this amendment in response to the United States Supreme Court's interpretation of the Sherman Act in a line of cases that served to limit the immunity of local governments from federal antitrust liability. We therefore examine these cases in order to determine whether they support the County appellees' proposed interpretation of the word municipality. ¶ 23 We agree that the United States Supreme Court has interpreted the Sherman Act, prior to its 1984 amendment, as applying on its face to all local governmental entities. City of Lafayette v. La. Power & Light Co., 435 U.S. 389, 396-98, 98 S.Ct. 1123, 55 L.Ed.2d 364 (1978) (recognizing that the term person in the Sherman Act included all entities, whether public or private, that engaged in business whose activities might restrain or monopolize commercial intercourse among the states and thus included both states and cities (internal quotation omitted)). In reaching this interpretation, the Court emphasized the strong federal policy in favor of a regime of competition, such that the antitrust laws will not be displaced unless [they] ... are plainly repugnant to a regulatory regime over an area of commercial activity. Id. at 398, 98 S.Ct. 1123. The Court then indicated that implied exclusions from the Act were disfavored. Id. at 399, 98 S.Ct. 1123. Reasoning that local governments serve parochial rather than national interests, the Court then concluded that [w]hen these bodies act as owners and providers of services, they are fully capable of aggrandizing other economic units with which they interrelate, with the potential of serious distortion of the rational and efficient allocation of resources, and the efficiency of free markets which the regime of competition embodied in the antitrust laws is thought to engender. Id. at 408, 98 S.Ct. 1123. ¶ 24 Unlike local governments, however, states themselves are coequal sovereigns with the federal government. Id. at 411-13, 98 S.Ct. 1123. On that basis, the Court has interpreted the Sherman Act as implicitly excluding states from its application. Id. at 400, 98 S.Ct. 1123 (citing Parker v. Brown, 317 U.S. 341, 351, 63 S.Ct. 307, 87 L.Ed. 315 (1943)). In City of Lafayette, a plurality of the Court further recognized that a local government falls within the Parker exemption when it acts as an agent of the state, pursuant to state policy to displace competition with regulation or monopoly public service. Id. at 413, 98 S.Ct. 1123 (plurality). The standard set forth by the City of Lafayette plurality was subsequently adopted by the Court. Cmty. Communications Co. v. City of Boulder, 455 U.S. 40, 51, 102 S.Ct. 835, 70 L.Ed.2d 810 (1982). Later cases have adhered to this general principle. See Fed. Trade Comm'n v. Ticor Title Ins. Co., 504 U.S. 621, 636-37, 112 S.Ct. 2169, 119 L.Ed.2d 410 (1992); City of Columbia v. Omni Outdoor Adver., Inc., 499 U.S. 365, 372-73, 111 S.Ct. 1344, 113 L.Ed.2d 382 (1991); Town of Hallie v. City of Eau Claire, 471 U.S. 34, 45, 105 S.Ct. 1713, 85 L.Ed.2d 24 (1985). ¶ 25 We agree with the County appellees that this line of cases provides interpretative guidance in this context, but we disagree concerning its import. We are unpersuaded that the United States Supreme Court's use of the specific term municipality in some instances where the enunciated principles applied equally to other units of local government indicates that the term is ambiguous or has a different meaning in the antitrust context, particularly where the entities at issue in the cases reviewed by the Court were in fact cities, as indicated in the case names above. Far from establishing that antitrust law in general uses the word municipality broadly, the County appellees have failed to point to a single instance where a court referred to a specific unit of local government as a municipality unless it was in fact a city or a town. ¶ 26 Moreover, we believe that the mandate in our Antitrust Act that we be guided by other courts' interpretations requires us to rely on the principles underlying those interpretations, rather than on the courts' particular word choice. When we examine the issue before us in that light, it becomes clear that the County appellees are asking us to engage in rather curious logic. They propose that, because the Court in the City of Lafayette line of cases held that the Sherman Act applies to all local governmental entities, unless they are acting as agents of the state, our Legislature must have intended to exempt all local governmental entities when they added the municipality exemption to Utah's Antitrust Act. Further, the County appellees repeat the argument, made before the district court, that the municipality exemption's purpose was to avoid incorporating the Court's decision in City of Lafayette into Utah antitrust law. Thus, according to the County appellees, we must follow the mandate that we rely on federal caselaw when interpreting the term municipality even as we recognize that the Legislature intended to circumvent the very federal caselaw that we are urged to follow. We decline to engage in such a tortured analysis. ¶ 27 The only remaining factor militating against the conclusion that the term municipality unambiguously refers only to municipal corporations is Senator Waddingham's statement in the floor debates, indicating his concern, when proposing the municipality exemption, about the impact of the City of Lafayette decision on the IPP. The extent to which an individual statement by a legislator is a reliable indicator of legislative intent has frequently been questioned. E.g., Wood v. Univ. of Utah Med. Ctr., 2002 UT 134, ¶ 19, 67 P.3d 436 (Legislators may decide that a statute should be passed for myriad, often even different, reasons....). Moreover, it is far from clear to us that legislative history should be relevant when making the initial determination of whether a statutory provision is ambiguous on its face. See Berube v. Fashion Ctr., 771 P.2d 1033, 1038 (Utah 1989) (agreeing that the statute at issue is clear on its face and should be applied accordingly, regardless of any specific intent formed by a particular legislator). At the same time, because our primary goal is to interpret statutes in accord with legislative intent, we might hesitate to disregard entirely such an indication of intent where it was clear, even if a provision appears to be unambiguous. [4] We do not believe Senator Waddingham's statement qualifies as such a clear indication of intent, however. The statement indicates that Senator Waddingham had not read City of Lafayette, and though the Senator specifically mentions the IPP, he does not indicate that he considers the IPP itself, or its owner, the IPA, to be a municipality that would be subject to antitrust legislation in the absence of the proposed exemption. Rather, Senator Waddingham, in stating that the exemption's purpose is to cause actions taken by municipalities ... to be on the same card as activities conducted by utilities, uses the term municipalities himself, making it difficult to conclude that he accorded the word a meaning other than the generally accepted definition of municipal corporation. ¶ 28 Thus, as the Summit Water appellants suggest, Senator Waddingham's language is simply too vague to draw specific conclusions on these matters from his statements alone. It seems that, in order to accord Senator Waddingham's statement the significance that the County appellees suggest it deserves, we would have to engage in a full analysis of whether the IPA and IPP are otherwise subject to Utah's Antitrust Act and, if so, whether the legislature intended these entities to be free to engage in anti-competitive activities. Although the IPA, in its role as amicus in the present case, argues that both of these questions must be answered in the affirmative, and indeed that the municipality exemption was constructed with it specifically in mind, we are unwilling to undertake such a review when the IPA's status and activities are not actually at issue in the case before us. ¶ 29 Moreover, we believe the district court erred in according Senator Waddingham's statement such weight without considering the proper import of other interpretative principles in the antitrust context. We adhere to the fundamental principle underlying the Court's decision in City of Lafayette  that antitrust laws must be interpreted in light of the strong public policy disfavoring anticompetitive practices. City of Lafayette, 435 U.S. at 398, 98 S.Ct. 1123. Indeed, our deference to this policy must be particularly strong in light of Article XII, Section 20 of our state constitution as well as the Legislature's explicit finding, set forth in the Antitrust Act itself, that competition is fundamental to the free market system and that the unrestrained interaction of competitive forces will yield the best allocation of our economic resources, the lowest prices, the highest quality and the greatest material progress, while at the same time providing an environment conducive to the preservation of our democratic, political and social institutions. Utah Code Ann. § 76-10-912. Based on this policy, [5] we have previously indicated that provisions of our Antitrust Act must be strictly construed in favor of competition and that, therefore, exemptions [from the Act] should be construed narrowly. Evans v. State, 963 P.2d 177, 185 (Utah 1998); see also Group Life & Health Ins. Co. v. Royal Drug Co., 440 U.S. 205, 231, 99 S.Ct. 1067, 59 L.Ed.2d 261 (1979) (It is well settled that exemptions from the antitrust laws are to be narrowly construed. This doctrine ... applies with equal force to express statutory exemptions.). Thus, even if we were to conclude that the term municipality in section 76-10-915(1)(f) is ambiguous, this interpretive principle suggests that we adopt the narrowest possible meaning of the term, limiting it to municipal corporations. See Evans, 963 P.2d at 185. ¶ 30 For the reasons set forth above, we cannot conclude that the term municipality in section 76-10-915(1)(f) is ambiguous, nor, if it were ambiguous, would we be likely to interpret the term broadly. However, we acknowledge that we are unable to perceive any logical reason for including cities and towns in the municipality exemption but excluding other units of local government. In the interest of judicial caution, therefore, we reserve an ultimate decision on the meaning of municipality for another day and proceed to analyze whether, assuming the County appellees would qualify as municipalities, their activities at issue here are exempt because they were authorized or directed by state law for purposes of Utah Code section 76-10-915(1)(f).