Court Opinion

ID: 4553632
Source: CourtListenerOpinion
Date Created: 2020-08-06 16:14:30.956717+00
Date Added: 2024-06-11T09:25:50.122514
License: Public Domain

FILE                                                               THIS OPINION WAS FILED
                                                                              FOR RECORD AT 8 A.M. ON
       IN CLERK’S OFFICE                                                            AUGUST 6 2020
SUPREME COURT, STATE OF WASHINGTON
        AUGUST 6, 2020
                                                                                 SUSAN L. CARLSON
                                                                               SUPREME COURT CLERK

                  IN THE SUPREME COURT OF THE STATE OF WASHINGTON

        PEACEHEALTH ST. JOSEPH MEDICAL )
        CENTER AND PEACEHEALTH ST. JOHN )                             No. 97557-4
        MEDICAL CENTER,                      )
                                            )                           En Banc
                          Petitioner,        )
        v.                                   )
                                             )                    August 6, 2020
                                                            Filed_____________________
        STATE OF WASHINGTON,                 )
        DEPARTMENT OF REVENUE,               )
                                             )
                          Respondent.        )
        _____________________________________)

               OWENS, J. ― RCW 82.04.4311 provides a business and occupation (B&O)

        tax deduction to public and nonprofit hospitals on compensation they receive from

        both Washington State and the federal government for health care services subsidized

        under certain government-funded programs, such as Medicaid and Children’s Health

        Insurance Programs (CHIP). Petitioners PeaceHealth St. Joseph Medical Center and

        PeaceHealth St. John Medical Center (PeaceHealth) argue that, under RCW

        82.04.4311’s plain language, qualifying Washington hospitals are entitled to a B&O

        tax refund and deduction on compensation they receive from any state’s CHIP or
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

Medicaid programs, not just Washington’s. PeaceHealth alternatively argues that by

excluding compensation that qualifying Washington hospitals receive from other

states’ CHIP and Medicaid programs, the department unlawfully penalizes those

hospitals that serve out-of-state patients, thus violating the dormant Commerce Clause

of the United States Constitution.

      In holding that RCW 82.04.4311’s deduction excludes compensation that

qualifying hospitals receive from other states’ CHIP and Medicaid programs, the

Court of Appeals used the series-qualifier rule of statutory construction (in which a

postpositive modifier normally applies to all nouns or verbs in a series when there is a

straightforward, parallel construction) in lieu of the last antecedent rule (in which

qualifying words or phrases modify only the immediately preceding words or

phrases). We hold that the Court of Appeals properly applied the series-qualifier rule

to delimit the scope of RCW 82.04.4311’s deduction, thus we affirm the Court of

Appeals’ reasoning on this issue. Additionally, because we find that RCW

82.04.4311 supports a traditional government function without any differential

treatment favoring local private entities over similar out-of-state interests, we hold

that RCW 82.04.4311 is constitutional under the government function exemption to

the dormant Commerce Clause.

                                            2
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

                                         FACTS

      In 1980, the legislature enacted former RCW 82.04.4297, which created a B&O

tax exemption for “amounts received from the United States” or “from the state of

Washington . . . as compensation for, or to support, health or social welfare services

rendered by a health or social welfare organization” (i.e., Medicaid). LAWS OF 1980,

ch. 37, § 17. This original deduction was limited to compensation received from

Washington State and the federal government and did not cover compensation

received from other states’ health care programs. 1 See id.

      In subsequent years, the legislature observed that third-party-managed health

care organizations had assumed an increasingly greater role in the provision and

disbursement of covered benefits, leading to a decrease in direct payments from both

the federal government and Washington to qualifying hospitals. See LAWS OF 2002,

ch. 314, § 1. The legislature concluded that “the tax status of these amounts should

not depend on whether the amounts are received directly from the qualifying program

or through a managed health care organization under contract to manage benefits for a

qualifying program.” Id. Thus, the legislature amended RCW 82.04.4297 and created

RCW 82.04.4311. See id. §§ 1-3. That revised statute, under which PeaceHealth

brings this current action, now states that

1
 Nonprofit hospitals, like those managed by PeaceHealth, were exempt from paying any
B&O taxes until 1993. LAWS OF 1993, ch. 492, § 305.
                                              3
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

             [a] public . . . or a nonprofit hospital . . . may deduct from the measure of
      tax amounts received as compensation for health care services covered under
      the federal medicare program authorized under Title XVIII of the federal social
      security act; medical assistance, children’s health, or other program under
      chapter 74.09 RCW; or for the state of Washington basic health plan under
      chapter 70.47 RCW.

RCW 82.04.4311 (emphasis added).

      PeaceHealth applied for a refund from the Department of Revenue for the

period of December 1, 2007, through December 31, 2008, seeking a deduction for all

taxes paid on out-of-state Medicaid and CHIP revenue during this time period.

PeaceHealth relies on the second clause of RCW 82.04.4311, which entitles

qualifying hospitals to claim a B&O deduction on compensation received under

“medical assistance, children’s health, or other program under chapter 74.09 RCW.”2

The department denied PeaceHealth’s request, reasoning that RCW 82.04.4311’s

deduction for compensation received from CHIP and Medicaid programs authorized

“under chapter 74.09 RCW” necessarily excludes compensation received from other

states’ CHIP and Medicaid programs. PeaceHealth appealed the department’s

decision to the Board of Tax Appeals, and the board granted PeaceHealth’s motion for

summary judgment, holding that PeaceHealth was entitled to the deduction. The

department petitioned for judicial review, and the superior court reversed the board’s

2
  For purposes of this opinion, we recognize that RCW 82.04.4311’s discussion of “medical
assistance” and “children’s health” programs are references to Medicaid and CHIP. See
RCW 74.09.500, .470(1).
                                            4
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

decision. The Court of Appeals affirmed, PeaceHealth St. Joseph Med. Ctr. v. Dep’t

of Revenue, 9 Wn. App. 2d 775, 785, 449 P.3d 676 (2019), and PeaceHealth

petitioned for review, which was granted. PeaceHealth St. Joseph Med. Ctr. v. Dep’t

of Revenue, 194 Wn.2d 1016 (2020).

                                       ANALYSIS

   1. RCW 82.04.4311’s Deduction Does Not Extend to Compensation That
      Qualifying Hospitals Receive from Other States’ Medicaid and CHIP programs

       The party seeking a tax deduction bears the burden of showing that it is entitled

to the benefit sought, and any doubt or ambiguity as to the availability of a statutory

benefit is “to be construed strictly, though fairly and in keeping with the ordinary

meaning of [the statute’s] language, against the taxpayer.” Group Health Coop. of

Puget Sound, Inc. v. Wash. State Tax Comm’n, 72 Wn.2d 422, 429, 433 P.2d 201

(1967).

       We review questions of statutory interpretation de novo and interpret statutes

so as to give effect to the legislature’s intentions. State v. Bunker, 169 Wn.2d 571,

577-78, 238 P.3d 487 (2010). We derive legislative intent solely from the plain

language of the statute, considering the text of the provision, the context of the statute,

related provisions, amendments, and the statutory scheme as a whole. First Student,

Inc. v. Dep’t of Revenue, 194 Wn.2d 707, 710, 451 P.3d 1094 (2019) (citing

Cashmere Valley Bank v. Dep’t of Revenue, 181 Wn.2d 622, 631, 334 P.3d 1100

(2014)). We regularly employ traditional rules of grammar when discerning a
                                             5
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

statute’s plain language. Bunker, 169 Wn.2d at 578. When a statute’s plain language

is unambiguous, meaning it is subject to only one reasonable interpretation, our

inquiry ends, and we will not resort to interpretive tools such as legislative

history. Spokane County v. Dep’t of Fish & Wildlife, 192 Wn.2d 453, 458, 430 P.3d

655 (2018) (citing State v. Velasquez, 176 Wn.2d 333, 336, 292 P.3d 92 (2013)).

      The contested clause in RCW 82.04.4311 establishes a deduction for

“compensation for health care services covered under . . . medical assistance,

children’s health, or other program under chapter 74.09 RCW.” PeaceHealth argues

that we should apply the last antecedent rule when interpreting this provision. The

“last antecedent rule” states that qualifying words or phrases modify only those words

or phrases that immediately precede them. BLACK’S LAW DICTIONARY 1598-99 (11th

ed. 2019). As applied here, the phrase “under chapter 74.09 RCW” would modify

only the immediately preceding phrase “other program” and would not be read to

modify “medical assistance” or “children’s health.” Consequently, under this reading,

compensation that qualifying hospitals receive from any state’s CHIP or Medicaid

programs would theoretically qualify for the statutory deduction.

      Conversely, citing “the overall structure of Washington’s subsidized health

programs within chapter 74.09 RCW,” the Court of Appeals applied the series-

qualifier rule. PeaceHealth, 9 Wn. App. 2d at 780. This rule provides that “when

there is a straightforward, parallel construction that involves all nouns or verbs in a

                                            6
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

series, a prepositive or postpositive modifier normally applies to the entire

series.” BLACK’S LAW DICTIONARY, supra, 1642. Applied here, the contested clause

is understood to read “medical assistance [program under chapter 74.09 RCW],

children’s health [program under chapter 74.09 RCW], or other program under

chapter 74.09 RCW.” RCW 82.04.4311. Accordingly, under this reading, RCW

82.04.4311’s deduction excludes compensation hospitals receive from other states’

CHIP or Medicaid programs.

      Analyzing both the context of the contested clause and the broader statutory

scheme of RCW 82.04.4311 as a whole, we hold that the Court of Appeals properly

applied the series-qualifier rule. See Lockhart v. United States, ___ U.S. ___, 136 S.

Ct. 958, 963, 194 L. Ed. 2d 48 (2016) (analyzing both the context of the provision and

the broader statutory scheme). Washington’s CHIP and Medicaid programs are both

“program[s] under chapter 74.09 RCW”—Washington’s Medicaid program is

established under RCW 74.09.500 and CHIP is established under RCW 74.09.470(1).

Furthermore, as the remaining phrase “other program” indicates, chapter 74.09 RCW

also establishes a number of “other” Washington-State-funded health care programs.

See, e.g., RCW 74.09.035(1) (authorizing medical care services to persons eligible for

the aged, blind, or disabled assistance program authorized under RCW 74.62.030, or

eligible for essential needs and housing support under RCW 74.04.805), .800

(establishing the maternity care access program). Thus, within the context of the

                                            7
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

contested clause, the modifier “program under chapter 74.09 RCW” makes sense

when it is uniformly applied to all of the items in the series: medical assistance

(Medicaid), children’s health (CHIP), and these other programs. See Paroline v.

United States, 572 U.S. 434, 447, 134 S. Ct. 1710, 188 L. Ed. 2d 714 (2014) (“‘When

several words are followed by a clause which is applicable as much to the first and

other words as to the last, the natural construction of the language demands that the

clause be read as applicable to all.’” (quoting Porto Rico Ry., Light & Power Co. v.

Mor, 253 U.S. 345, 348, 40 S. Ct. 516, 64 L. Ed. 944 (1920))).

       Likewise, our analysis of the structure of the statute in which this contested

provision is located further supports our applying the series-qualifier rule.

Semicolons divide RCW 82.04.4311 into three categories: (1) the Medicare program

“under Title XVIII of the federal social security act;” (2) medical assistance,

children’s health, or other program “under chapter 74.09 RCW;” and

(3) Washington’s basic health plan “under chapter 70.47 RCW.” As the department

argues, and as the Court of Appeals correctly held, these parallel statutory references

to “under Title XVIII,” “under chapter 70.47 RCW,” and “under chapter 74.09 RCW”

show that the overall structure of the statute supports the application of the series-

qualifier rule in this instance. Analyzing RCW 82.04.4311 as a whole—three parallel

provisions, each referencing the law authorizing the identified programs therein—the

contested provision is subject to only one reasonable interpretation.

                                            8
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

       PeaceHealth cites to the United States Supreme Court’s decision in Lockhart to

argue that the Court of Appeals erred by not first applying the last antecedent rule

“and showing that it did not work” before resorting to applying the series-qualifier

rule. Appellants’ Suppl. Br. at 15. But, contrary to PeaceHealth’s argument, we need

not always first attempt to apply the last antecedent rule, abandoning it only when the

rule’s application “produces a nonsensical result.” Id. Even the fact that a statute

makes grammatical sense under the last antecedent rule does not mandate the rule’s

application. Nobelman v. Am. Sav. Bank, 508 U.S. 324, 330, 113 S. Ct. 2106, 124 L.

Ed. 2d 228 (1993). As the Court in Lockhart reasoned, and as the Court of Appeals

below recognized, “the rule of the last antecedent ‘is not an absolute and can

assuredly be overcome by other indicia of meaning.’” 136 S. Ct. at 963 (quoting

Barnhart v. Thomas, 540 U.S. 20, 26, 124 S. Ct. 376, 157 L. Ed. 2d 333 (2003)).

       PeaceHealth, as the taxpayer, bears the burden of showing that it is entitled to

the deduction sought, and applying the series-qualifier rule is in keeping with our

responsibility to strictly but fairly construe the availability of the statutory benefit

against the taxpayer. See Group Health Coop., 72 Wn.2d at 429. As shown here, our

analysis of both the context of the contested provision and the broader statutory

scheme as a whole in which this provision is located show that the Court of Appeals

correctly applied the series-qualifier rule when interpreting the scope of RCW

                                              9
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

82.04.4311’s deduction, which excludes compensation qualifying hospitals receive

from other states’ CHIP and Medicaid programs. 3

    2. RCW 82.04.4311’s Limited Deduction Is Constitutional under the Government
       Function Exemption to the Dormant Commerce Clause

       The Commerce Clause grants Congress the power to “regulate commerce . . .

among the several states.” U.S. CONST., art. I, § 8, cl. 3. The negative implication of

this constitutional grant of power to Congress, the dormant Commerce Clause,

“significantly limits the ability of States and localities to regulate or otherwise burden

the flow of interstate commerce.” Maine v. Taylor, 477 U.S. 131, 151, 106 S. Ct.

2440, 91 L. Ed. 2d 110 (1986). The dormant Commerce Clause was born out of a

concern of “‘economic protectionism—that is, regulatory measures designed to

benefit in-state economic interests by burdening out-of-state competitors.’”

McBurney v. Young, 569 U.S. 221, 235, 133 S. Ct. 1709, 185 L. Ed. 2d 758 (2013)

(quoting New Energy Co. of Ind. v. Limbach, 486 U.S. 269, 273-74, 108 S. Ct. 1803,

3
  PeaceHealth and amici rely heavily on select language in the legislative findings to argue
that RCW 82.04.4311 should be read broadly to apply to compensation received from all
states’ CHIP and Medicaid programs, not just Washington’s, relying on legislative findings
in LAWS OF 2002, ch. 314, § 1. But when a statute’s plain language is unambiguous, our
inquiry into the statute’s meaning ends. Spokane County, 192 Wn.2d at 458. A statement of
legislative intent “does not trump the plain language of the statute,” and such statements are
not controlling even when the codified intent of the legislature speaks directly to the enacted
statute. State v. Reis, 183 Wn.2d 197, 212, 351 P.3d 127 (2015) (quoting Kilian v. Atkinson,
147 Wn.2d 16, 23, 50 P.3d 638 (2002) (plurality opinion)). Under RCW 82.04.4311’s plain
language, “medical assistance, children’s health, or other program” unambiguously form a
single category of programs all modified by the phrase “under chapter 74.09 RCW,” which
limits the deduction to compensation received from Washington, not other states.
                                              10
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

100 L. Ed. 2d 302 (1988)). Accordingly, “the dormant Commerce Clause precludes

States from ‘discriminat[ing] between transactions on the basis of some interstate

element.’” Comptroller of Treasury v. Wynne, 575 U.S. 542, 549, 135 S. Ct. 1787,

191 L. Ed. 2d 813 (2015) (alteration in original) (quoting Bos. Stock Exch. v. State

Tax Comm’n, 429 U.S. 318, 332 n.12, 97 S. Ct. 599, 50 L. Ed. 2d 514 (1977)). This

means that, barring some exception, a state “‘may not tax a transaction or incident

more heavily when it crosses state lines than when it occurs entirely within the

State.’” Id. (quoting Armco Inc. v. Hardesty, 467 U.S. 638, 642, 104 S. Ct. 2620, 81

L. Ed. 2d 540 (1984)). “That the tax discrimination comes in the form of a

deprivation of a generally available tax benefit” is of no consequence, nor does it

matter if the discriminatory burden is only indirectly imposed on the out-of-state

customer by means of a tax on the entity transacting business. Camps

Newfound/Owatonna, Inc. v. Town of Harrison, 520 U.S. 564, 578, 580, 117 S. Ct.

1590, 137 L. Ed. 2d 852 (1997).

      However, despite these general prohibitions, an exemption to the dormant

Commerce Clause exists for when the government is performing a traditional

government function. United Haulers Ass’n v. Oneida-Herkimer Solid Waste Mgmt.

Auth., 550 U.S. 330, 343, 127 S. Ct. 1786, 167 L. Ed. 2d 655 (2007).

                                           11
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

       We hold that RCW 82.04.4311 is constitutional under the government function

exemption to the dormant Commerce Clause.4 The United States Supreme Court first

applied the government function exemption in 2007 in United Haulers, and the

present case marks the first time that we have been asked to apply this relatively new

principle of Commerce Clause jurisprudence. The government function exemption is

premised on the Court’s understanding that laws that discriminate in favor of local

government may be directed toward any number of legitimate goals unrelated to the

general protectionism that the Commerce Clause forbids. Id. Thus, under this

exemption, laws that (1) benefit the exercise of a government function while

(2) treating all other private entities the same are constitutional under the Commerce

Clause. Id.

       In United Haulers, the Court upheld a series of New York county ordinances

that required trash haulers to deliver waste to state-owned and operated waste

processing facilities. Id. at 334. The Court held that the challenged flow-control

ordinances were constitutional because they favored a clearly public enterprise—

government-operated waste processing—while treating all other private economic

interests the same. Id. at 342. As the Court explained, “‘any notion of discrimination

4
  Because we find the statute constitutional under the government function exemption, we
do not address whether the statute would also be constitutional under the market participant
exemption, which allows states to discriminate in favor of their own citizens provided the
state is acting as a participant in the relevant market rather than a market regulator. Reeves,
Inc. v. Stake, 447 U.S. 429, 437, 100 S. Ct. 2271, 65 L. Ed. 2d 244 (1980).
                                               12
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

assumes a comparison of substantially similar entities[,]’ [b]ut States and

municipalities are not private businesses.” Id. (citation omitted) (quoting Gen. Motors

Corp. v. Tracy, 519 U.S. 278, 298, 117 S. Ct. 811, 136 L. Ed. 2d 761 (1997)). This is

so because “[s]tate and local governments that provide public goods and services on

their own, unlike private businesses, are ‘vested with the responsibility of protecting

the health, safety, and welfare of [their] citizens.’” Dep’t of Revenue v. Davis, 553

U.S. 328, 340, 128 S. Ct. 1801, 170 L. Ed. 2d 685 (2008) (second alteration in

original) (quoting United Haulers, 550 U.S. at 342).

       In Davis, the Court upheld a Kentucky income tax law that exempted from

income any interest earned on municipal bonds issued by Kentucky while taxing as

income any interest earned on bonds issued by any other state or private party. Id. at

331-32. The Court recognized that issuing bonds was a “quintessentially public

function” given that the issuance of debt securities allows local governments to pay

for public projects. Id. at 342. Thus, the Court held the Kentucky law constitutional

under the government function exemption because the “tax exemption favors a

traditional government function without any differential treatment favoring local

entities over substantially similar out-of-state interests.” Id. at 343.

       As the Court in Davis explained, the point of our inquiry into whether a

challenged statute or regulation supports a government function is “not to draw fine

distinctions among governmental functions, but to find out whether the preference [is]

                                             13
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

for the benefit of a government fulfilling governmental obligations or for the benefit

of private interests, favored because they [are] local.” Id. at 341 n.9. Here, RCW

82.04.4311 is analogous to the laws upheld in Davis and United Haulers because the

deduction supports a quintessentially public function by helping to subsidize the

government’s provision of essential health care services to Washington’s citizens by

facilitating the expansion of the government’s overall purchasing power for such

services.

      In response, PeaceHealth argues that because RCW 82.04.4311 does not

directly regulate the provision of health care subsidies or the rates at which they are

set, upholding this indirect relationship between the government function and the

challenged regulation would endorse an overexpansive reading of the government

function exemption. But PeaceHealth’s focus on whether the deduction directly

regulates Washington’s provision of health care subsidies misconstrues what courts

consider when applying the government function exemption—only the market

participant exemption asks whether there is a direct relationship between the

challenged regulation and the government’s actions in the relevant market. See White

v. Mass. Council of Constr. Emp’rs, Inc., 460 U.S. 204, 208, 103 S. Ct. 1042, 75 L.

Ed. 2d 1 (1983) (holding that, to determine whether the market participant exemption

applies, courts must analyze whether the challenged state program constitutes direct

                                           14
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

state participation in the market). No similar inquiry appears in the Court’s

discussions of the government function exemption.

      Equally, if not more important to our dormant Commerce Clause analysis,

PeaceHealth fails to identify any local private interests that are favored under the

statute. Accordingly, we have little by way of either argument or evidence to rebut

the conclusion that RCW 82.04.4311 permissibly “favors a traditional government

function without any differential treatment favoring local entities over substantially

similar out-of-state interests.” See Davis, 553 U.S. at 343 (emphasis added). To the

contrary, PeaceHealth argues only that the challenged deduction disfavors both

Washington hospitals and Washington citizens. See, e.g., Pet. for Review at 17-18

(arguing that RCW 82.04.4311 increases the cost of health care services generally in

Washington).

      Our review of Camps, on which PeaceHealth relies, helps highlight why RCW

82.04.4311 does not favor local entities over substantially similar out-of-state

interests. There, the Court found unconstitutional a Maine statute exempting charities

incorporated in the state from real estate and personal property taxes unless the charity

was conducted or operated principally for the benefit of out-of-state residents.

Camps, 520 U.S. at 568. Unlike the B&O deduction here, which is effectively

calculated on a patient-by-patient basis, the unconstitutional statute in Camps operated

in binary fashion, privileging only some in-state charities with a tax deduction while

                                           15
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

flat out denying others based on a threshold assessment of each charities’ total number

of out-of-state clients served. Id. at 576 (finding Maine’s statute impermissibly

discriminatory because the state “singl[ed] out camps that serve[d] mostly in-staters

for beneficial tax treatment”). By outright exempting only some charities for

differential taxation, the statute in Camps plainly treated competing private entities

differently. However, the same cannot be said here, where every qualifying public

and nonprofit Washington hospital, regardless its location or client population, is

subject to the same exclusions on the scope of RCW 82.04.4311’s deduction.

      In the context of both the design of Medicaid and similar government

subsidized health care programs and the regional nature of health care services in

general, PeaceHealth is free to question whether RCW 82.04.4311’s limited deduction

is good policy, but absent evidence of impermissible protectionism, PeaceHealth fails

to show what it must for us to find the statute unconstitutional under the dormant

Commerce Clause.

                                    CONCLUSION

      Under the series-qualifier rule of statutory construction, RCW 82.04.4311’s

B&O tax deduction excludes compensation qualifying hospitals receive from other

states’ CHIP and Medicaid programs. Additionally, because RCW 82.04.4311

benefits a quintessential government function without any differential treatment

favoring local private interests over out-of-state interests, we hold that RCW

                                           16
PeaceHealth St. Joseph Med. Ctr. v. Dep’t of Revenue
No. 97557-4

82.04.4311 is constitutional under the government function exemption of the dormant

Commerce Clause. Accordingly, we affirm the Court of Appeals’ decision.

 WE CONCUR:

                                           17