Opinion ID: 1296160
Heading Depth: 1
Heading Rank: 1

Heading: The Valid Portions of the Act.

Text: 1. In enumeration of error five, intervenor claims the Act is invalid because it does not serve a legitimate public purpose. It is clear, however, that the promotion of safe, sanitary housing is a purpose cognizable by the state under the police power. See Williamson v. Housing Authority of Augusta, 186 Ga. 673 (199 SE 43) (1938); see, e. g.: West v. Tennessee Housing Development Agency, 512 SW2d 275 (Tenn. 1974); Minnesota Housing Finance Agency v. Hatfield, 297 Minn. 155 (210 NW2d 298) (1973); Maine State Housing Authority v. Depositors' Trust Co., 278 A2d 699 (Me. 1971); Martin v. North Carolina Housing Corp., 277 N. C. 29 (175 SE2d 665) (1970). Further, the Act specifically provides that the development and stimulation of trade and commerce in the housing industry of this State is vital to the public welfare, creates employment opportunities and lessens unemployment and under-employment both in the home construction and real estate industry, and that an adequate supply of money with which to finance safe and sanitary dwelling accommodations for the people of Georgia is necessary to the health of the people of the State. Code Ann. § 99-3602 (b). That this purpose is legitimate is bolstered by the Georgia Constitution itself: The development of trade, commerce, industry and employment opportunities is hereby declared to be a public purpose vital to the welfare of the people of this State. The General Assembly may create development Authorities to promote and further such purposes... Const., Art. VII, Sec. VII, Par. V (a) (Code Ann. § 2-6005.1). Thus, we find that the Act is a valid exercise of the police power by the General Assembly pursuant to a legitimate public purpose. Intervenor interposes, however, that since the state may not constitutionally make loans, it can not set up an authority to do what it can not do. In so arguing, intervenor cites Mulkey v. Quillian, 213 Ga. 507 (100 SE2d 268) (1957) in which we held that the State Highway Board could not constitutionally lend money to municipalities or authorities to remove and relocate utilities located in the rights-of-way of state highways. That case, however, is distinguishable because the loan to local authorities there was to be a loan by the state of public money. Here, the funds used to carry out the purposes of the authority are derived from the sale of the authority's revenue bonds, and is thus private, not public, money. Code Ann. § 99-3609 (a). Similarly, there is no merit to intervenor's claim that Tippins v. Cobb County Parking Authority, 213 Ga. 685 (100 SE2d 893) (1951), and Beazley v. DeKalb County, 210 Ga. 41 (77 SE2d 740) (1953), [1] necessarily limit the types of ventures in which a state may participate. These cases involve the establishment of authorities by a political subdivision of the state ( Beazley v. DeKalb County, supra), or by the state for a political subdivision ( Tippins v. Cobb County Parking Authority, supra), which are limited in their undertakings under the Constitution to certain enumerated purposes. Constitution, Art. VII, Sec. VII, Par. V (Code Ann. § 2-6005). See Daughtrey v. State, 226 Ga. 758 (177 SE2d 670) (1970). The same limitation does not apply to the state itself. This section and these cases are thus inapposite. In enumeration seven, intervenor contends that the Authority Act violates the provisions of the Constitution, which limit the purposes for which the state may incur debt (Const., Art. VII, Sec. III, Par. I; Code Ann. § 2-5601), and for which the state may pledge its credit (Const., Art. VII, Sec. III, Par. II; Code Ann. § 2-5602). It has long been clear, however, that an authority, being an agent of the state but not the state itself, is not restricted by the state's debt limitation in the Constitution. McLucas v. State Bridge Bldg. Authority, 210 Ga. 1 (77 SE2d 531) (1953). Nor does the debt of an authority or agency obligate the state or pledge the credit of the state as is required to be made explicit by the authority on the face of the bonds it issues. Code Ann. § 99-3610. State v. Regents of University System of Georgia, 179 Ga. 210 (175 SE 567) (1934). This enumeration thus has no merit. Additionally, intervenor claims in enumeration fifteen that since, in 1970, the voters refused to ratify a proposed constitutional amendment to set up an authority for a similar purpose, the General Assembly, as the representative of the people, can not now contravene that expression of the public and designate the promotion of housing a public purpose. This argument ignores the fact that the constitution and the electoral process are the only checks on the power of the General Assembly. Since we find no constitutional limitations on the power of the legislature to promote housing for low income families under its police power, we must again leave the people to express their will through their right to vote. Having carefully considered all of intervenor's enumerations relating to the power of the General Assembly to enact such legislation, we hold that the promotion of housing for low and moderate income families and the stimulation of the housing market to be a valid public purpose. 2. Intervenor's first enumeration of error is a contention that the Revenue Bond Law (Code Ann. § 87-8) does not authorize the validation of the bonds the authority wishes to issue, because the authority's purpose is not an allowable undertaking for which bonds may be validated under the Revenue Bond Law. Code Ann. § 87-802. The Authority Act provides that [a]ll revenue bonds issued by the authority under this Chapter shall be executed, confirmed, and validated under, and in accordance with, the Revenue Bond Law,... except as otherwise provided in this Chapter. Code Ann. § 99-3609 (1). (Emphasis supplied.) The manifest intent of the legislature was to adopt only the procedures set out in the Revenue Bond Law (Code Ann. §§ 87-814 to 87-823). In fact, that law itself makes clear that the limitations imposed by this Chapter shall not affect the powers conferred by any other general, special, or local law. Code Ann. § 87-825. We therefore conclude that the Georgia Residential Finance Authority Act does not violate the provisions of the Revenue Bond Law in not presenting an allowable undertaking under that law. Intervenor, in his second enumeration of error, presents the question whether the validation petition adequately complies with the provisions of the Revenue Bond Law, requiring that the petition set forth the amount of annual interest and when the bonds are to be paid in full. Code Ann. § 87-816. We have reviewed the petition and exhibits and find this enumeration to be without merit. There was ample evidence in favor of the economic feasibility and soundness of the bonds presented to the trial court. Since the burden is on the intervenor to come forward with evidence to support any affirmative defenses interposed by him against the petition by the state setting forth the validity of the bond issue [2] ( Harrell v. Town of Whigham, 141 Ga. 322 (80 SE 1010) (1913)), and the intervenor produced none, the trial court did not err in finding the program sound, reasonable, feasible and practical. See Mays v. State, 110 Ga. App. 881 (140 SE2d 223) (1965). Furthermore, this is a legislative matter subject to the most limited review by the courts. See Holcombe v. Georgia Milk Producers Confederation, 188 Ga. 358 (3 SE2d 705) (1939). We thus reject intervenor's enumeration four. The third enumeration of error proposes that since the Act provides that the bonds issued shall be general obligations of the Authority, (Code Ann. § 99-3603 (b)) (emphasis supplied), the series A revenue bonds are not an authorized type of bond which the authority may issue. It is clear from the Act, however, that the authority is authorized to issue revenue bonds. Code Ann. § 99-3609. We do not find that these two sections conflict. 3. Enumerations of error eight, nine, ten and eleven challenge the composition of the membership of the authority, and, thus, the validity of any action already taken by them on behalf of the authority. The Act provides for six members: the Governor or in his stead the Director of the Office of Planning and Budget, the State Auditor, the Director of the Financing and Investment Division, the Commissioner of Community Development, and two public members to be appointed by the Governor with the Senate's confirmation Code Ann. § 99-3605 (a). Enumeration of error eight raises a separation of powers question. Intervenor contends that since the state auditor is elected and paid by the legislative arm of government, the separation of powers [3] required in the constitution will be offended if he serves as a member of the authority, which is a part of the executive branch. Const., Art. I, Sec. I, Par. XXIII (Code Ann. § 2-123); Greer v. State, 233 Ga. 667 (212 SE2d 836) (1975). The General Assembly has provided for a state auditor in Title 40, which deals with the Executive Department. Code Ann. Ch. 40-18. Furthermore, it is clear that the duties outlined there are executive, rather than legislative, in nature for he has no lawmaking power. That the state auditor, who will monitor the use of state money by the executive branch is elected by the General Assembly and funds for his operations are scheduled under the legislative division of the Appropriation Act does not require a different result, but is simply a reflection of the system of checks and balances among the three branches of government. The separation of powers principle is sufficiently flexible to permit practical arrangements in a complex government, and though it is not always easy to draw a line between executive functions and legislative functions, it is quite plain to us in this case that the functions performed ... are primarily, if not exclusively, executive. Greer v. State, p. 669, supra. We therefore find no merit in intervenor's contentions in this regard. Similarly, we find no merit in intervenor's enumerations nine and ten that the provisions for the public members of the authority, one residing within, one outside the Standard Metropolitan Statistical Areas of the State; one, a representative of the homebuilding industry, the other a member of the mortgage lending industry, are invalid because these terms are vague. These descriptions are sufficiently exact to allow the Governor to make two valid appointments when necessary. We cannot say that such qualification of the term public members renders it contradictory as contended by the intervenor. The word public in reference to these appointed members is used to distinguish them from the four permanent members, who are state officials. Intervenor argues additionally that the use of the term Standard Metropolitan Statistical Area (SMSA) [4] violates the one-man, one-vote principle in giving disproportionate representation to those outside the SMSA's where fewer Georgians live. He makes the same claim regarding the two public members to be chosen from the homebuilding and mortgage lending industries, asserting that these two businesses are thus over-represented. It is clear from Sailors v. Board of Education of the County of Kent, 387 U. S. 105 (87 SC 1549, 18 LE2d 650) (1967), however, that the one-man, one-vote mandate of the Constitution applies only to elected officials, and is thus inappropriate where, as here, members of a clearly administrative authority are appointed. Intervenor next contends that by adopting the SMSA to determine representation, the General Assembly has illegally delegated its legislative power to the United States Department of Commerce Office of Management and Budget, which defines SMSA's. Const., Art. III, Sec. I, Par. I (Code Ann. § 2-1301). As we made clear in Featherstone v. Norman, 170 Ga. 370, 394 (153 SE 58) (1930), [w]hen a statute adopts a part or all of another statute, domestic or foreign, general or local, by specific and descriptive reference thereto, the adoption takes the statute as it exists at that time. The subsequent amendment or repeal of the adopted statute or any part thereof has no effect upon the adopting statute. (Emphasis supplied.) The same is true here. In adopting SMSA as a guideline to appointing the public members of the Authority, the legislature adopted the SMSA statistical population description as it existed in 1975 when the Act was amended. Ga. L. 1975, pp. 1651, 1655 (Code Ann. § 99-3605 (a)). Thus, under the authority of Featherstone, supra, we do not find that such a guideline is defective in illegally delegating legislative power. As so interpreted, we hold that the Act manifests a clear, definite statement of legislative intent, and a workable definition from which the Governor may appoint the public members of the authority. Since we have held that the public members and the state auditor are proper members of the Georgia Residential Finance Authority, any and all actions taken by them as members of that body are valid and enforceable. Thus enumerations of error eight, nine, ten and eleven present no grounds for refusing to validate this bond issue. 4. That the rules and regulations of the authority are invalid because the Authority does not have the power to adopt them is the interventor's twelfth enumeration of error. The Act, however, provides that the Authority shall make necessary rules and regulations for its own government, (Ga. L. 1974, pp. 975, 981; Code Ann. § 99-3605 (b)), The Authority shall have the power ... (4) to make and alter bylaws for its organization and internal management,... [and] (25) to do any and all things necessary or convenient to carry out its purposes and exercise the powers given and granted in this Chapter, (Ga. L. 1974, pp. 875, 983; Code Ann. § 99-3606 (a)). In addition, the Authority shall establish administrative guidelines as to limitations for eligible persons and families ... Ga. L. 1974, pp. 975, 983, as amended by Ga. L. 1975, pp. 1651, 1659 (Code Ann. § 99-3606 (c)). The Act thus amply establishes the power of the authority to make rules and regulations. Furthermore, we do not find that the Act is void for illegally delegating legislative power to the authority as contended by intervenor in enumeration thirteen. Having declared the purposes of the Act, and enacted provisions to carry the same into effect, the General Assembly could properly confer on the governing board of the authority the powers of which complaint is made. Williamson v. Housing Authority of Augusta, 186 Ga. 673, 681 (199 SE 43) (1938). Accord: Southern R. Co. v. Melton, 133 Ga. 277 (65 SE 665) (1913); Georgia R. v. Smith, 70 Ga. 694 (1883). 5. Intervenor's fourteenth enumeration of error asserts that the 1974 and 1975 Acts are unconstitutional for the reason that the 1974 Act refers to more than one subject matter (Ga. L. 1974, pp. 975, 987, 989; Code Ann. §§ 99-3607, 99-3608), and the 1975 Act contains matter different from that expressed in its title (Ga. L. 1975, pp. 1651, 1659-60; Code Ann. § 99-3607 (e) (9)). Const., Art. III, Sec. XVII, Par. XIII (Code Ann. § 2-1908). We find these contentions to be without merit. This court has always held that every detail of the Act need not be expressed in the caption and as long as the provisions are germane to the general purpose of the Act they will not be considered different subject matter. Since the caption of the 1974 Act specifically mentions making loans and purchasing mortgages and since both of these provisions are in furtherance of the general purposes expressed in the Act, the statute is not unconstitutional for referring to more than one subject matter. Undercofler v. Hospital Authority of Forsyth County, 221 Ga. 501 (145 SE2d 487) (1965); Hope v. Mayor &c. of Gainesville, 72 Ga. 246 (1884). Similarly, the caption of the 1975 Act includes an expressed intent to repeal conflicting laws which is carried out in Section 7 (e) (9) (Code Ann. § 99-3607 (e) (9)). Therefore, it can not be said that no notice of this repealer is contained in the caption of the Act, or that the Act contains matters not included in the title. Williamson v. Housing Authority of Augusta, supra; Cady v. Jardine, 185 Ga. 9 (193 SE 869) (1937). 6. Intervenor's enumeration sixteen is a contention that Section 14 of the Act, Code Ann. § 99-3614, which grants a tax exemption to all bondholders, violates the Constitution in not being the valid subject of a tax exemption. The Georgia Constitution (Art. VII, Sec. I, Par. IV; Code Ann. § 2-5404), provides that the General Assembly may, by law, exempt from taxation all public property;... We have already decided that the Authority has been established for a valid public purpose, and we have held many times that bonds issued by the state or its institutions are public instrumentalities, and thus, properly exempted from taxation under this constitutional provision. Sigman v. Brunswick Port Authority, 214 Ga. 332 (104 SE2d 467) (1958); Williamson v. Housing Authority, supra. Similarly, there is no merit to intervenor's contention that the state has illegally granted a tax exemption to the authority.