Opinion ID: 1403585
Heading Depth: 1
Heading Rank: 3

Heading: is there a fulfillment of public purpose?

Text: Article IX, § 6, of the Alaska constitution provides that [n]o tax shall be levied, or appropriation of public money made, or public property transferred, nor shall the public credit be used, except for a public purpose. It is asserted that the bond issue and the plan for its expenditure violates this provision. In DeArmond v. Alaska State Development Corporation, 376 P.2d 717 (Alaska 1962), this court noted that the term public purpose is one of great imprecision. As we said there, We believe that it would be a disservice to future generations for this court to attempt to define it. It is a concept which will change as changing conditions create changing public needs. Whether a public purpose is being served must be decided as each case arises and in the light of the particular facts and circumstances of each case. 376 P.2d at 721. The technique used by most courts is that of looking to the entire factual and governmental context to determine whether a particular plan of action serves a public purpose. [8] In the area of industrial development bond issues, numerous decisions have upheld such plans. [9] There is much criticism which can be leveled against a community using its public borrowing capacity to sponsor or induce the location of private industry within its boundaries. Many of these plans have been attacked on grounds of public policy, but they have been sustained frequently by the courts. [10] It is true that such plans are susceptible to abuse. Municipalities have been known to go bankrupt after having induced an industry to come to them under such a plan. [11] There are dangers that an industry locating in a community may end up dominating the political and economic processes. On the other hand, it is recognized that the location of an industry in a particular community may have widespread economic benefits and that these do fulfill the public purpose and the general welfare of the community, broadly conceived. The tendency in most of the modern case law is to broaden the notion of public purpose to include such projects as the one contemplated by the City of Palmer. [12] In Walker v. Alaska State Mortgage Association, 416 P.2d 245 (Alaska 1966), and in Suber v. Alaska State Bond Committee, 414 P.2d 546 (Alaska 1966), such broad notions of public purpose were applied. As we observed in the Suber case, The basic objective of government is to protect and promote the health, safety and general welfare of the people. When a condition of affairs appears in the state which presents a threat to the accomplishment of that objective, the government has the right, and the obligation, to cope with such threat by whatever measures, within constitutional limits, that are necessary or appropriate. 414 P.2d, at 551-552. The role of the courts in matters of this kind is relatively limited. Our function is not to determine whether, as prudent burghers, we might think this plan wise. City of Juneau v. Hixson, supra. The test which we must apply is whether the plan is so unreasonable as to transgress the limitations of our constitution. If the plan of action were plainly foolhardy, or if it amounted to the pledging of credit or the giving away of assets without any corresponding discernible benefit, we might be persuaded to strike down the plan. But that is not the case here. The benefits from the plan of the City of Palmer may be enjoyed in part by some individuals more than by others. But collective advantages to the community at large can be perceived quite readily. Although the development of industry is not always an unmixed blessing, as it may impose burdens upon other public facilities, it is hard to see how the City of Palmer could be hurt by the location of an industry within its boundaries. Its plight at the moment is that of an eroding economic community. If the city fathers and the voters of the community feel that this plan of action is necessary, it is not for us to retard them. It is within their legislative province to determine whether the advantages outweigh the risks. Because we think the public purpose of the project has been demonstrated, we find the bond issue valid. Affirmed.