Opinion ID: 6534258
Heading Depth: 3
Heading Rank: 1

Heading: Text of Article IX, Section 3a

Text: Applying that interpretative methodology, we look first to the text of Article IX, section 3a. Again,  Article IX, section 3a, limits the uses of two categories of taxes, set out in paragraph (1)(a) and paragraph (1)(b): (a) Any tax levied on, with respect to, or measured by the storage, withdrawal, use, sale, distribution, importation or receipt of motor vehicle fuel or any other product used for the propulsion of motor vehicles; and (b) Any tax or excise levied on the ownership, operation or use of motor vehicles. Petitioners argue that the Section 90 tax falls within paragraph (1)(b) because it is a tax on the ownership  of motor vehicles. Specifically, petitioners contend that taxes on the ownership  of motor vehicles include taxes levied on the exercise of any of the rights of ownership, including the rights to sell and use. Petitioners posit that the voters would have understood the concept of ownership to include multiple segregable rights or incidents, principal among which were the rights to sell and to use, and, therefore, it is likely that the voters would have understood taxes levied on the ownership  of motor vehicles to include taxes levied on the sale or use of motor vehicles. Contrary to petitioner's argument, the text of Article IX, section 3a, does not indicate that the taxes on the ownership  of motor vehicles include taxes levied on, or measured by, sales of motor vehicles. Instead, for two reasons, the text indicates that taxes on the ownership  of motor vehicles are limited to taxes levied on the status of ownership, and do not include taxes levied on actions-like a sale-that an owner may take. First, the text of Article IX, section 3a, shows that the drafters identified the subject taxes by describing the specific action or status on which the tax is levied, and that they referred separately to taxes levied on use, sales, and ownership. Paragraph (1)(a) lists taxes relating to several actions involving motor vehicle fuels, specifically, the storage, withdrawal, use, sale, distribution, importation or receipt of such fuels. Of particular relevance to this case, paragraph (1)(a) includes taxes levied on, or measured by, the sale of motor vehicle fuels, as well as the use of tax fuels. In contrast to paragraph (1)(a), paragraph (1)(b)  applies only to taxes on the ownership, operation, and use of motor vehicles. Thus, of the several actions listed in paragraph (1)(a), the only one included in paragraph (1)(b) is use. Paragraph (1)(b) does not refer to taxes on sales, even though paragraph (1)(a) does. The fact that paragraph (1)(a) of Article IX, section 3a, refers to taxes levied on sales, but paragraph (1)(b) does not, indicates that paragraph (1)(b) does not include taxes levied on sales. See generally  Springfield Utility Board v. Emerald PUD , 339 Or. 631 , 642, 125 P.3d 740 (2005) (generally, when a term is used in one provision and excluded from another, courts assume that exclusion was purposeful and meant to indicate a distinction between the two provisions); Perlenfein and Perlenfein , 316 Or. 16 , 22, 848 P.2d 604 (1993) (when a legislature or agency uses a particular term in one provision of a statute or regulation, but omits that same term in a parallel and related provision, this court infers that the enacting or promulgating body did not intend that the term apply in the provision from which the term is omitted); see also King Estate Winery, Inc. v. Dept. of Rev. , 329 Or. 414 , 422, 988 P.2d 369 (1999) (in statute exempting certain categories of farm machinery from ad valorem taxation, the legislature's reference to machines for processing and selling farm products in the subsection relating to animal farming, but not in the subsection relating to crop farming, indicated that the legislature did not intend to exempt machines for processing and selling crops); Hughes v. State of Oregon , 314 Or. 1 , 28, 838 P.2d 1018 (1992) (statute that referred to past and present retirement benefits did not apply to future retirement benefits, given that drafters knew how to refer to the future, as evidenced by their reference to future taxes). In other words, the text of Article IX, section 3a, shows that the drafters knew how to refer to taxes levied on, or measured by, sales, and they did so in paragraph (1)(a), with respect to motor vehicle fuels, but not in paragraph (1)(b), with respect to motor vehicles. The fact that a reference to taxes levied on, or measured by, sales is clearly included in paragraph (1)(a) and clearly omitted from paragraph (1)(b) indicates that the voters would have understood and intended the constitutional provision to apply to taxes based on, or  measured by, sales of motor vehicle fuel, but not taxes based on, or measured by, sales of motor vehicles. Second, the text shows that the drafters knew how to create a broad category of taxes, and they did so in paragraph (1)(a), but not in paragraph (1)(b), which would have indicated to the voters that paragraph (1)(b)'s reference to taxes levied on the ownership of motor vehicles is not as encompassing as petitioners contend. To explain, paragraph (1)(a) refers to any tax levied  on, with respect to, or measured by  certain bases, whereas paragraph (1)(b) refers only to any tax levied  on  certain bases. That difference indicates that, although paragraph (1)(b) applies to all taxes levied on the ownership of motor vehicles, it does not apply to all taxes levied with respect to, or measured by the ownership of motor vehicles. That, in turn, indicates that, as used in Article IX, section 3a, taxes on the ownership of a motor vehicle are limited to those based on the fact of ownership itself-that is, ownership qua ownership-and they do not include taxes based on all actions that an owner might take, such as selling or buying. In other words, as Attorney General Thornton concluded in 1956 when determining the scope of former Article IX, section 3 (1942),  'the word ownership was intended in the sense normally used in relation to ad valorem taxes where the source of tax liability is the ownership of property with all its incidents.'  28 Op. Atty. Gen. 20, 21 (1956). 7   2. Legislative History of Article IX, Section 3a The legislative history of Article IX, section 3a, supports that interpretation. As mentioned, the relevant text of Article IX, section 3a, was first adopted by the voters in 1942 as former Article IX, section 3 (1942). The legislature referred the provision to the voters as a constitutional amendment, and a legislative committee drafted the only argument in the voters' pamphlet describing the provision. In that argument, the committee explained that the referral raises this question for the people of Oregon to answer: Shall the Constitution be amended to guarantee that the gasoline, diesel fuel, ton mile and other taxes paid only by motor vehicle users be used for highways, roads and streets, and for the other closely related purposes now provided by law? Official Voters' Pamphlet, General Election, Nov. 3, 1942, 11 (internal quotation marks omitted). According to the committee, the answer was yes, and the purpose of the amendment was to re-assert and to write into the constitution of this state, the principle underlying the gasoline tax and the other taxes on motor vehicle users which is, that the revenues from these taxes and imposed ONLY on such users should be devoted solely to highway purposes. Id. (uppercase in original). Throughout the argument, the committee referred to the taxes at issue as user taxes. Specifically, it described them as taxes on motor vehicle users, taxes paid only by motor vehicle users, special highway user taxes, and special taxes on users of the highway. Id. The committee contended that the amendment was necessary to protect highway users from unfair taxation, explaining that other states had expended funds from the gasoline tax or the registration fee or both for non-highway purposes, which was wholly unjust to the motor vehicle user for, like his fellow taxpayers, he paid real and personal property taxes, income taxes, gift taxes, school taxes, water taxes, sales taxes, and all the rest, and IN ADDITION these special highway taxes, which he fully expected would be used on the highways. Id. (uppercase in original). The committee asserted, It is unfair and unjust to tax motor vehicle transportation unless  the proceeds of such taxation are applied to highways. Id . (internal quotation marks omitted). In keeping with its repeated descriptions of the taxes at issue as user taxes, the only taxes that the committee specifically mentioned were the gasoline, diesel fuel, ton mile, and registration taxes. The parties in this case disagree about what the legislative history of Article IX, section 3a, indicates. Petitioners argue that it shows that Article IX, section 3a, paragraph (1)(b), applies to all taxes based on a status or activity involving a motor vehicle. In their view, it applies to all taxes that are likely to be passed on to highway users. For its part, respondent argues that the legislative history shows that Article IX, section 3a, was intended to ensure that, when citizens paid taxes attributable to their use of public roads for motor vehicle transportation, the revenue from those taxes would be devoted solely to the construction and maintenance of those public roads. Therefore, respondent argues, Article IX, section 3a, applies only to taxes that are-unlike sales taxes on vehicles-directly attributable to the use of public roads. See 40 Op. Atty. Gen. 59 (1979) (distinguishing between a direct tax and an indirect burden reflected in the price of goods or services). We conclude that the legislative history establishes that Article IX, section 3a, was intended to apply to special highway user taxes, as the legislative committee explained in its argument in support of the provision. It was intended to promote fair and equitable taxation by dedicating taxes paid only by highway users-meaning, as respondent argues, taxes attributable to the use of public highways for motor vehicle transportation-to highway purposes. The committee repeatedly emphasized that the provision would apply to taxes on highway users, and the only taxes that it mentioned were taxes paid in connection with the use of public highways. Thus, it appears that Article IX, section 3a, was intended to apply only to taxes including, and similar to, the following: fuel taxes (such as gasoline and diesel taxes); ownership taxes (such as title and registration fees, which must be paid as prerequisite  to public highway use); operation taxes (such as driver's license fees); and use taxes (such as ton mile taxes).  Petitioners' argument that the legislative history shows that Article IX, section 3a, applies to all taxes based on a status or activity involving a motor vehicle is unavailing. The legislative history indicates that the provision applies to special highway user taxes; it does not indicate that the provision applies to all taxes (for example, any business, license, regulatory, income, or property tax) imposed on a status or activity involving motor vehicles (for example, selling, repairing, painting, or disposing of motor vehicles).