Court Opinion

ID: 9633142
Source: CourtListenerOpinion
Date Created: 2023-08-22 11:35:07.837591+00
Date Added: 2024-06-11T13:09:21.438421
License: Public Domain

Brachtenbach, J.
(dissenting) — When a public utility district acquires property previously held by private interests, that property is taken from the tax rolls. Recognizing the potential burden to school districts which had issued bonds in reliance on the now-exempt property, the legislature, in RCW 54.28.080, provided protection to the districts by requiring the public utility district to pay the same amount of principal and interest that the property would have produced in private ownership.
To me the intent of the statute is that simple, logical and clear. Yet the majority thwarts that intent by holding that it is the nature and use of the property by the private owner prior to acquisition which governs application of the statute.
The majority opinion leads to the anomalous result that the acquisition by a public utility district of what was in private ownership a valuable nongenerating property requires no payment to the school district while the acquisition of an equally valuable generating property requires payment. Obviously the result to the school district is exactly the same in either case — it has been deprived of bond payment moneys from property on the tax rolls when the bonds were authorized. Considering the relevant sections of RCW 54.28, I cannot attribute to the legislature such an unreasonable and illogical intent.
The pertinent portion of RCW 54.28.080 reads: “Whenever any [public utility] district acquires an operating property from any private person, firm, or corporation . . .” The majority contends that if the legislature had intended to include within the ambit of RCW 54.28.080 all property acquired by public utility districts for the gener*848ation, transmission or distribution of electric energy, it could have used the words “all property.” But it is just as logical to argue that if the legislature had intended to trigger the statute only upon the acquisition by a public utility district of a facility previously used for such purposes, it could have said so.
Moreover, the majority overlooks the fact that in RCW 54.28.010 (which is controlling for all of chapter 54.28) the legislature did define “operating property” as “all of the property utilized by a public utility district in the operation of a plant or system for the generation, transmission, or distribution of electric energy for sale . . .” (Italics mine.) The pivotal issue, not dealt with by the majority, is the meaning of “utilized” in RCW 54.28.010.
The majority points out a potential inconsistency between RCW 54.28.010 and RCW 54.28.080. If one assumes — as the majority implicitly does — that “utilized” in RCW 54.28.010 is restricted to use of the property prior to the public utility district acquisition, the two sections cannot be read together. For if one incorporates this definition of “utilized” from RCW 54.28.010 into .080, it would literally mean that .080 applies only when a public utility district acquires from a private person, firm or corporation property which was previously used by the public utility district for the generation, transmission or distribution of electrical energy for sale. Such a narrow reading of the legislative intent is strained at best.
The parties have stipulated that without the property in question herein, the production of electric energy could not be accomplished. I believe that “utilized” in RCW 54.28.010 was intended to include property, such as this, which is to be so utilized after its acquisition by the public utility district. Indeed, the common definitions of the word “utilize” suggest an element of change in use:
Utilize: to make useful: turn to profitable account or use: make use of: convert to use.
Webster’s Third New International Dictionary (1963).
*849Applying this broader definition of “utilized,” RCW 54.28.010 is consistent with RCW 54.28.080. Indeed this interpretation leads to the logical result that property which becomes exempt from taxation must bear its proportionate share of existing bonded indebtedness. From the standpoint of the school district’s obligation to pay its bonded indebtedness it matters little whether it loses part of its revenue by a public utility district’s acquiring a taxed generating plant or by a public utility district’s acquiring extensive farmlands of equal value for reservoir purposes. Conceivably the dollar loss could be identical, but the majority grants reimbursement in one case and denies it in the other. We should avoid statutory construction which leads to a gross injustice or absurd results. Amburn v. Daly, 81 Wn.2d 241, 501 P.2d 178 (1972). The legislature must have intended that the term “utilized” include property acquired by a public utility district for the future creation of a generating facility.
The remaining arguments offered by the majority to support its illogical result are unpersuasive. The contention that the allocation to school districts of part of the privilege tax levied on public utility districts by RCW 54.28.020 could offset the loss of revenue resulting from the removal of nonoperating property from the tax rolls is erroneous and purely makeweight. There is nothing in the record to show a correlation between these drastically different sources of revenue. In fact, the school distribution formula requires a reduction in state funds of 85 percent of receipts from public utility district funds distributed pursuant to RCW 54.28.090, while bond redemption funds paid pursuant to RCW 54.28.080 are not used to reduce the state fund distributions. Attorney General Opinion, Aug. 13, 1963. The difference in fiscal impact upon the local district is apparent and refutes the majority’s effort to justify its result on that basis.
The majority’s tracing of the legislative history of the statute adds absolutely nothing to a determination of legis*850lative intent. The definition of “operating property” has remained exactly the same throughout the several enactments. RCW 54.28.080 resulted from Laws of 1949, ch. 227, § 1 (g). As then enacted it read “Whenever any district hereafter acquires an operating property, as defined in section 1 of this act . . .” The underlined portion was omitted in Laws of 1957, ch. 278, § 8. The omitted language was sur-plusage as RCW 54.28.010 mandates that its definitions apply to all provisions of the chapter. Thus, I submit that no aid is rendered to the issue by the legislative history.
The final speculation engaged in by the majority is that the legislature intended the statute to apply only when there is a loss of a large taxable item. The record does not indicate the value of the property involved herein. The language of the statute indicates no such intent. The surface appeal of that conjecture disappears when one recognizes that the loss of bond redemption funds may be just as great when a public utility district acquires thousands of acres of valuable farmlands for reservoir purposes as when it acquires a generating facility or a transmission line. In fact, the majority’s opinion can be read to require acquisition of an entire facility before the statute applies. There is nothing in the statute to create such a holding. Even under the majority’s interpretation, the statute should apply when a public utility district acquires a substation, for example, from a private utility.
I would affirm the trial court and require the defendant to comply with RCW 54.28.080.
Finley, Wright, and Utter, JJ., concur with Brachten-bach, J.
Petition for rehearing denied November 29, 1973.