Opinion ID: 1198944
Heading Depth: 1
Heading Rank: 6

Heading: The district court observed:

Text: There is little doubt that if the Foundation completed 100 percent of the tasks involved in putting together the concert series that ticket sales would have been exempt from the FDA tax. There is also little doubt that the FDA tax would apply if the joint venture or Fey completed 100 percent of the tasks involved in putting together the concert series and simply used the Zoo facility as a venue. Somewhere in the middle of those two extremes the Zoofest concert series stopped being the Foundation's concert series and became a concert series produced and run by the joint venture and/or Fey. At that point, the Zoofest tickets were no longer sold to or by the city or any department thereof. The district court's observation is correct. Whether or not the joint venture is an agency of the Foundation, the principal issue upon which the majority and dissenting opinions turn, is not, in my view, controlling. Because the exemption for purchasers itself turns on whether the sales are by the city, the substance and not the form of the joint venture enterprise should control, whether or not the concert series is the Foundation's or Fey's. And to resolve this issue, in my view, an examination of which party has the power to control the joint venture and collect a greater share of its profits is determinative. Where, as here, a private person obtains a position of control, financially and administratively, of an independent enterprise, the hallmarks of government fail to exist. And, therefore, any benefit dependent upon government status should not be acknowledged. The majority's analysis utilizing agency principles, therefore, does not extend far enough to reach the substance of the transactions (involving purchases of admission) to resolve the issue presented here. The majority holds that the concert series is not eligible for [the] tax exemption [for sales by the city or a department of the city] because an agency relationship did not exist between the Foundation and the joint venture.... Maj. op. at 658. For future concerts, therefore, if the joint venture agreement is amended to provide a clause declaring that for all purposes, Fey or the joint venture has entered into an agency relationship with the Foundation, the majority's objection is answered without any substantive change to the Co-promotional Agreement. I do not believe this mere change in form alone should be determinative of the issue before us. Therefore, without an examination of which party in particular had control of the operation and was entitled to the economic benefits of the profits, we cannot resolve whether the joint venture was acting as the city or any department thereof. IV. I would conclude that because admission to the concert series was not sold in transactions to or by the city or any department thereof, D.R.M.C. § 53-347(3), the claimed tax exemption is not available to purchasers of admission tickets. Hence, the joint venture was required to collect the tax ... from the purchaser[s], D.R.M.C. § 53-348(a), and because it failed to do so, it is liable to the city, as a penalty, for the amount of tax it did not collect plus 10% of said amount, and interest, D.R.M.C. § 53-358(a). Accordingly, while I join in the judgment of the majority and agree that the judgment of the court of appeals must be reversed, I cannot join in its reasoning and its opinion. SCOTT, J., specially concurs. HOBBS, J., dissents, and MARTINEZ, J., joins in the dissent.