Court Opinion

ID: 9629738
Source: CourtListenerOpinion
Date Created: 2023-08-22 09:48:04.06088+00
Date Added: 2024-06-11T18:07:22.932339
License: Public Domain

BRYSON, J.,
dissenting.
I join in the dissent of Justice Tongue. I further dissent for the reasons stated in my original dissenting opinion, 281 Or at 194, 576 P2d 1234 (1978). I wish to emphasize my constitutional objection. The Oregon Constitution, Art XI, sec 11, provides in part:
*208"Section 11. Tax limitation. (1) Except as provided in subsection (3) of this section, no taxing unit, whether it be the state, any county, municipality, district or other body to which the power to levy a tax has been delegated, shall in any year so exercise that power to raise a greater amount of revenue than its tax base as defined in subsection (2) of this section. The portion of any tax levied in excess of any limitation imposed by this section shall be void.
"(2) The tax base of each taxing unit in a given year shall be one of the following:
"(a) The amount obtained by adding six percent to the total amount of tax lawfully levied by the taxing unit, exclusive of amounts described in paragraphs (a) and (b) of subsection (3) of this section, in any one of the last three years in which such a tax was levied by the unit; or
"(b) An amount approved as a new tax base by a majority of the legal voters of the taxing unit voting on the question submitted to them in a form specifying in dollars and cents the amount of the tax base in effect and the amount of the tax base submitted for approval. The new tax base, if approved, shall first apply to the levy for the fiscal year next following its approval.
"(3) The limitation provided in subsection (1) of this section shall not apply to:
"(a) That portion of any tax levied which is for the payment of bonded indebtedness or interest thereon.
"(b) That portion of any tax levied which is specifically voted outside the limitation imposed by subsection (1) of this section by a majority of the legal voters of the taxing unit voting on the question.
«‡ íjc # ‡
Subsection (2) means that if the state wanted to levy a tax on real property to fund state programs, it would have to return to the year in which it last levied a property tax and could collect only that amount plus six percent. Alternatively, it could ask the voters to approve a new tax base for the state. The first method would presumably produce minimal funds because it has been years since the state levied a tax on real *209property,1 and the second method would probably not be happily received by the voters. It follows, then, that the state could not directly raise money by a state real property tax levy to pay the insurance company premiums per its contract. ORS 243.015.
But the legislature conceived an ingenious way around the constitutional limitation. They decided to specifically mandate this pension and insurance program and have the local governments pay the state for the sums they have expended plus the administrative expenses incurred by the Department of General Services. Accordingly, they adopted the following statutes:
ORS 243.015:
"* * * [T]he Department of General Services shall enter into a contract with an insurance company licensed to do business in this state to purchase insurance as described in ORS 243.025 for all police officers and firemen in the service of public employers.”
ORS 243.035:
"(1) The premiums and administrative costs incurred by the Department of General Services for the insurance provided for in ORS 243.005 to 243.045 shall be paid by the affected public employers and shall not come from funds of the Public Employes’ Retirement System.
"(2) Every public employer shall include in its budget amounts sufficient to pay the annualpremiums accruing on the policies of insurance issued pursuant to ORS 243.005 to 243.045, and amounts sufficient to reimburse the Department of General Services for its administrative expenses incurred under ORS243.005to 243.045. "(Emphasis added.)
Certainly, the state legislature has previously created local programs which, if carried out by the local governmental subdivision, would result in additional costs and an increase in the tax levy to pay therefor. An example of this would be the creating of a new circuit court position with its attendant expenses *210of courtroom space and services. However, under such circumstances the county commissioners budget for the expenses and they do not remit to the state Department of General Services. The legislature has never, from my limited examination of statutes, told a city or county to put the cost of a state-mandated program in the city or county budget, which then finds its way on the tax roll as an assessment on real property within the county or local governmental subdivision for the purpose of reimbursing the state. Regardless of any previous abuse, it does not make the present devious approach for the raising of money any less objectionable pursuant to the above constitutional provision.
At the time Article XI, section 11, of the Oregon Constitution was adopted, and at the time the legislation in question was passed, local governments funded and still principally fund, their operations through real property taxes. At a time when even the local real property tax is under attack by the citizenry for other reasons, it is unrealistic to argue that local governments could, or legally should, assess and levy on real property for additional taxes to pay the State Department of General Services for the state-mandated program.
In a great many instances, and particularly in cities the size of Astoria and La Grande, the expenses of these legislative mandates will be funded by a local tax on real property. The state is, therefore, in effect levying real property taxes for its own purposes through the local governments. In allowing the present legislation to stand, the majority is allowing the state to levy real property taxes without a vote of the taxpayers, and this the state is constitutionally forbidden to do.
For the above reasons, I dissent from the majority opinion and would affirm the circuit court judges and the Court of Appeals, which held the aforementioned legislative programs unconstitutional.

For all practical purposes, the state has no tax base for a state levy on real property.