Court Opinion

ID: 2620444
Source: CourtListenerOpinion
Date Created: 2013-10-31 14:04:37.409505+00
Date Added: 2024-06-11T10:58:24.180125
License: Public Domain

Present: Kinser, C.J., Millette, Mims, McClanahan, and Powell,
JJ., and Russell and Koontz, S.JJ.

ELIZABETH RIVER CROSSINGS OPCO, LLC

v.   Record No. 130954                        OPINION BY
                                     JUSTICE LEROY F. MILLETTE, JR.
DANNY MEEKS, ET AL.                        October 31, 2013

VIRGINIA DEPARTMENT OF TRANSPORTATION

v.   Record No. 130955

DANNY MEEKS, ET AL.

         FROM THE CIRCUIT COURT OF THE CITY OF PORTSMOUTH
               James A. Cales, Jr., Judge Designate

      In this appeal we hold that the General Assembly did not

unconstitutionally delegate its power of taxation to the

Virginia Department of Transportation ("VDOT") and Elizabeth

River Crossings OpCo, LLC ("ERC") under the terms of the

Public-Private Transportation Act of 1995, Code § 56-556 et

seq. ("PPTA"), and that the Comprehensive Agreement between

VDOT and ERC does not abridge the Commonwealth's police power.

                         I. Facts and Proceedings

A.    History of Tunnels Crossing the Elizabeth River

      A branch of the Elizabeth River separates the City of

Portsmouth from the City of Norfolk.     The first tunnel crossing

the Elizabeth River between Portsmouth and Norfolk was the two-

lane Downtown Tunnel, which opened in 1952.     The Downtown

Tunnel experienced "steadily increasing traffic . . . at levels
substantially higher than those originally projected."         In

response, the General Assembly authorized the construction of

an additional crossing in 1956.       The Midtown Tunnel was

subsequently built a short distance northwest of the Downtown

Tunnel and was opened in 1962.    By 1973, the General Assembly

was made aware that traffic through the Downtown Tunnel had

reached capacity, with substantial congestion being commonplace

and likely to get worse.   Further, the Midtown Tunnel was

projected to reach capacity within a few years.       The Downtown

Tunnel was therefore expanded so that a second, two-lane tube,

parallel to the original two-lane tube, was opened in 1987.

     Despite these earlier projects, traffic crossing the

Elizabeth River remained a substantial problem.       In 1996, a

Final Environmental Impact Statement submitted by the United

States Department of Transportation and VDOT noted that

transportation projects completed within the region have not

"lessen[ed] or alleviate[d] traffic congestion within the

project area."   The Final Environmental Impact Statement went

on to recognize that a proposed project to "improve traffic

movement between Portsmouth and Norfolk at the Midtown Tunnel

crossing and to alleviate long traffic queues and delays which

currently exist" would "result in significant benefits to the

local and regional transportation network."

                                  2
        By 2009, the General Assembly recognized the Midtown

Tunnel to be the "most heavily traveled two-lane road" in all

of Virginia, creating "both safety and congestion problems."

The General Assembly learned that during peak hours both the

Downtown Tunnel and the Midtown Tunnel experience the worst

possible levels of congestion, with traffic backups that extend

more than two miles.

        Although other alternatives were initially explored, the

next project to address this continuing problem of traffic

crossing the Elizabeth River arose under the framework of the

PPTA.

B.      The Public-Private Transportation Act

        The General Assembly enacted the PPTA in 1995 1 to allow

"private entities to develop and/or operate one or more

transportation facilities . . . in a more timely, more

efficient, or less costly fashion, thereby serving the public

safety and welfare."     Code § 56-558(A)(3).   In enacting the

PPTA, the General Assembly was motivated by "a public need for

timely development and/or operation of transportation

facilities."     Code § 56-558(A)(1).   The General Assembly

indicated that the development and operation of transportation

facilities would meet the public's needs by "improving safety,

        1
        The PPTA was amended and re-enacted on July 1, 2005.
2005 Acts chs. 504, 562.

                                   3
reducing congestion, increasing capacity, and/or enhancing

economic efficiency."    Id.    The General Assembly recognized

that the PPTA was necessary because these public needs would

"not be wholly satisfied by existing methods of procurement in

which qualifying transportation facilities are developed and/or

operated[, or] by existing ways in which transportation

facilities are developed and/or operated."      Code § 56-

558(A)(1)-(2).

     Under the terms of the PPTA, a "public entity that is an

agency or institution of the Commonwealth" may accept proposals

from private entities "to develop and/or operate a

transportation facility."      Code § 56-559(A)-(B).   The public

entity may approve a private entity's proposal only after the

private entity provides statutorily-specified material and

information to the public entity.      Code § 56-560(A).   Once this

material and information is submitted, the public entity may

approve "the development and/or operation of the transportation

facility or facilities as a qualifying transportation

facility."   Code § 56-560(C).

     However, such approval is dependent upon the public entity

determining that such development and/or operation of the

transportation facility "serves the public purpose of [the

PPTA]."   Id.    The development and/or operation of the

transportation facility or facilities serves the public purpose

                                   4
of the PPTA if: "[t]here is a public need for the

transportation facility or facilities;" "the transportation

facility or facilities . . . are, in the opinion of the . . .

public entity, reasonable and will address the needs identified

in the . . . transportation plan by improving safety, reducing

congestion, increasing capacity, and/or enhancing economic

efficiency;" "[t]he estimated cost of developing and/or

operating the transportation facility or facilities is

reasonable in relation to similar facilities;" and "[t]he

private entity's plans will result in the timely development

and/or operation of the transportation facility or facilities

or their more efficient operation."   Code § 56-560(C)(1)-(4).

     The PPTA also requires the public entity to "develop

guidelines that establish the process for the acceptance and

review of a proposal from a private entity," Code § 56-560(D),

and adopt guidelines "that are consistent with procurement

through 'competitive sealed bidding,'" Code § 56-573.1(1).

     Once the public entity selects a private entity's proposal

under the PPTA, but before development or operation of the

qualifying transportation facility begins, the public and

private entities must enter into a comprehensive agreement.

Code § 56-566(A).   The comprehensive agreement shall provide

the basic terms of the cooperative agreement between the public

entity and private entity.   Code § 56-566(A)(1)-(10).   The

                                5
comprehensive agreement shall also include a provision for user

fees, set forth the duties and obligations of the private

entity, and provide for the distribution of any earnings in

excess of the negotiated maximum rate of return as negotiated

in the agreement.   Code § 56-566(B), (D), (E).   Finally, upon

request by a member of the public, the private entity shall

make available a "schedule of the current user fees."    Code

§ 56-566(B).

C.   The Project: The Downtown Tunnel / Midtown Tunnel / MLK
     Extension
     In the 2007 Acts of Assembly, the General Assembly created

the Hampton Roads Transportation Authority "as a political

subdivision of the Commonwealth" and named it a "responsible

public entity as defined in the [PPTA]."     2007 Acts ch. 896.

The General Assembly gave the Transportation Authority the

authority to "impose and collect tolls in amounts established

by the [Transportation] Authority for the use of any new or

improved highway, bridge, tunnel, or transportation facility to

increase capacity on such facility."   Id.    Additionally, the

General Assembly allowed the "Midtown and Downtown tunnels

located within the Cities of Norfolk and Portsmouth" to be

"tolled if improvements are made to either tunnel."     Id.

     The General Assembly directed the Transportation Authority

to "phase construction of the transportation projects that are

                                6
included in the federally mandated 2030 Regional Transportation

Plan."    Id.    The "Downtown Tunnel / Midtown Tunnel / MLK

Extension" project (the "Project") was one of the first phase

projects that the Transportation Authority was directed to

pursue.    Id.   The Project is the subject of the current

litigation before this Court.

     In 2008, VDOT, an agency of the Commonwealth of Virginia,

and thus a "public entity," requested conceptual proposals from

private entities for financing, design, construction,

operation, and maintenance of the Project under the PPTA.       ERC,

a "private entity," responded to this request by submitting

such a proposal.     ERC's proposal for the Project was accepted

for further consideration and was reviewed and approved by an

independent review panel in accordance with the PPTA.     See Code

§ 56-560(C).

     In 2009, the General Assembly dissolved the Transportation

Authority and transferred its "power to impose and collect

tolls for the use of highways, bridges, and tunnels [to] the

Commonwealth Transportation Board."     Acts 2009 ch. 864, § 4.

The Commonwealth Transportation Board, under a recommendation

by the independent review panel, adopted a resolution to

continue pursuing ERC's proposal.

     On December 5, 2011, VDOT and ERC entered into a final

comprehensive agreement (the "Comprehensive Agreement").       The

                                   7
Commonwealth Transportation Board affirmed the Project and

specifically approved and ratified the imposition and

collection of tolls on the Project as contemplated by the

Comprehensive Agreement.

     Pursuant to the Comprehensive Agreement, the Project

provides for the design and construction of a new Midtown

Tunnel.    This new Midtown Tunnel will pass under the Elizabeth

River between Portsmouth and Norfolk, and is located next to

the existing Midtown Tunnel.   The Project also includes the

design and construction of the Martin Luther King Freeway

Extension (the "MLK Extension"), which would connect State

Route 164 to Interstate 264 and provide alternative access

routes to the Midtown and Downtown Tunnels.   Finally, the

Project includes continual maintenance of the existing Midtown

and Downtown Tunnels for 58 years.

     The Comprehensive Agreement grants ERC the authority to

construct, maintain, and operate the facilities for a 58-year

period.    However, the Commonwealth retains ownership of all of

the facilities involved in the Project.   The total cost for

completing the Project is estimated to exceed $2.04 billion

dollars.   Funding for the Project comes from federal and state

loans, a large investment from ERC, direct payments from the

Commonwealth, and tolls from users of the facilities.   Included

within the Comprehensive Agreement are VDOT's findings,

                                 8
concluding that "the estimated cost of developing, designing,

operating and maintaining the Project is reasonable in relation

to similar transportation facilities."   Tolls are scheduled to

commence on February 1, 2014.

D.   The Litigation

     On July 12, 2012, Danny Meeks, along with other residents

of the City of Portsmouth and longtime users of the Downtown

Tunnel ("Meeks"), filed a complaint against ERC and VDOT in the

Circuit Court for the City of Portsmouth.   ERC removed the case

to the United States District Court for the Eastern District of

Virginia with VDOT's consent, but the case was subsequently

remanded after Meeks filed an amended complaint that omitted

the only federal claim.   The amended complaint contains six

counts:

          (1) [T]hat the General Assembly has
          unlawfully delegated its legislative power
          in violation of Article IV, § 1 of the
          Constitution of Virginia;

          (2) that the General Assembly has violated
          Article IV, § 14, cl. 7 of the Constitution
          of Virginia by authorizing a state agency
          to grant a special tax exemption to a
          private party;

          (3) that the General Assembly has violated
          Article IV, § 14, cl. 8 of the Constitution
          of Virginia by authorizing a state agency
          to agree to diminish a private party's
          obligation to the Commonwealth and its
          local governments;

                                9
           (4) that the General Assembly has violated
           Article IV, § 14, cl. 9 of the Constitution
           of Virginia by authorizing a state agency
           to grant a special refund of state and
           local taxes to a private party;

           (5) that [VDOT] lacked authority to execute
           the [Comprehensive Agreement] with [ERC];
           and

           (6) that tolls, penalties, and surcharges
           authorized by the [Comprehensive Agreement]
           between [VDOT and ERC] violate the Due
           Process Clause of Article I, § 11 of the
           Constitution of Virginia.

The parties agreed that the case should be decided on cross-

motions for summary judgment on a stipulated record.     In its

final order, the circuit court dismissed Counts 3 through 5

without prejudice.   Count 6 was dismissed with prejudice.

      The circuit court found in favor of Meeks on Counts 1 and

2.   It granted Meeks' motion for summary judgment on Counts 1

and 2, ruling that the General Assembly "exceeded its

authority" by:   (1) "ceding the setting of toll rates and taxes

in the circumstances of this case for the use of facilities

that have been bundled solely for revenue-producing purposes in

violation of Article IV, § 1 of the Constitution of Virginia,"

and (2) giving "unfettered power to [VDOT] to set toll rates

without any real or meaningful parameters in violation of

Article IV, § 1 of the Constitution of Virginia."   Final

judgment was entered on May 21, 2013.   The circuit court also

denied VDOT and ERC's motion for a stay pending appeal, holding

                                10
that VDOT and ERC would suffer no irreparable harm absent an

appeal, and that "damage to [Meeks] and the public interest

. . . . far outweighs any damage to the [Commonwealth]."

      VDOT and ERC filed petitions for appeal, and the Court

granted review of the following issues: (1) whether the toll

fees imposed on users of the Midtown Tunnel, Downtown Tunnel,

and MLK Extension are taxes; (2) whether the General Assembly

has, through its enactment of the PPTA, unconstitutionally

delegated its power of taxation to VDOT and ERC in violation of

Article IV, § 1 of the Constitution of Virginia; and (3)

whether the circuit court erred in denying VDOT and ERC's

request for a stay pending appeal.    The Court also granted

review of Meeks' assignments of cross-error, which include the

following issues: (1) whether the PPTA unconstitutionally

delegates the authority to set toll rates, an exclusively

legislative function, to VDOT, and (2) whether the

Comprehensive Agreement unconstitutionally abridges the General

Assembly's police power and the sovereignty of the

Commonwealth.

                           II.   Discussion

A.   Standard of Review

     In an appeal "aris[ing] from the grant of a motion for

summary judgment . . . , we will review the application of law

to undisputed fact de novo."     Transportation Insurance Co. v.

                                 11
Womack, 284 Va. 563, 567, 733 S.E.2d 656, 658 (2012) (internal

quotation marks omitted).

     In reviewing the constitutionality of a statute "our

determination of legislative intent is guided by the recognition

that all actions of the General Assembly are presumed to be

constitutional."   Montgomery Cnty. v. Virginia Dep't of Rail &

Pub. Transp., 282 Va. 422, 435, 719 S.E.2d 294, 300 (2011)

(internal quotation marks omitted).     "There is . . . no stronger

presumption known to the law."    Id.   Accordingly, "only where

the statute in issue is 'plainly repugnant' to a constitutional

provision will we declare it null and void."     Jamerson v.

Womack, 244 Va. 506, 510, 423 S.E.2d 180, 182 (1992) (internal

quotation marks omitted).

B.    Whether the Circuit Court Erred in Holding that Tolls are
      Taxes Rather than Valid User Fees

      VDOT and ERC assign error to the circuit court's finding

that tolls on the Midtown Tunnel, Downtown Tunnel, and MLK

Extension are taxes, rather than valid user fees.    They claim

that the tolls are user fees because they constitute a

contractual payment by users of the Midtown Tunnel, Downtown

Tunnel, and MLK Extension in exchange for use of the integrated

transportation network that the facilities create.    VDOT and

ERC argue further that the tolls do not constitute taxes

because all revenue from the tolls goes to the integrated

                                 12
transportation network and does not fund unrelated projects or

purposes.

     Meeks contends that the Project tolls are a tax because

their primary purpose is to raise revenue.   Meeks challenges

VDOT and ERC's argument that the Project tolls are voluntary

contractual payments in exchange for a particularized benefit,

arguing that the payments cannot be voluntary because there are

no reasonable travel alternatives for users of the Midtown and

Downtown Tunnels.   Meeks also contends that the Midtown Tunnel,

Downtown Tunnel, and MLK Extension do not constitute an

integrated transportation network because each facility is

located at least two miles from the others, and because the

Downtown Tunnel was added to the Project solely as a means of

increasing toll revenue.

     We disagree with Meeks and find that the circuit court

erred in holding that the tolls at issue are taxes.   We have

previously held that a tax is "an enforced contribution imposed

by the government for governmental purposes or public needs."

Westbrook, Inc. v. Town of Falls Church, 185 Va. 577, 582, 39

S.E.2d 277, 280 (1946).    "Taxes are levied for the support of

government, and their amount is regulated by its necessities."

Sands v. Manistee River Improvement Co., 123 U.S. 288, 294

(1887).

                                 13
     In contrast, tolls are user fees when they are "nothing

more than an authorized charge for the use of a special

facility."   Hampton Roads Sanitation Dist. Comm. v. Smith, 193

Va. 371, 378, 68 S.E.2d 497, 501 (1952); see also Sands, 123

U.S. at 294 ("Tolls are the compensation for the use of

another's property, or of improvements made by him.").

     In the present case, the tolls paid by users of the

Project facilities are user fees because: (1) the toll road

users pay the tolls in exchange for a particularized benefit

not shared by the general public, (2) drivers are not compelled

by government to pay the tolls or accept the benefits of the

Project facilities, and (3) the tolls are collected solely to

fund the Project, not to raise general revenues.    See Murphy v.

Massachusetts Turnpike Auth., 971 N.E.2d 231, 236 (Mass. 2012)

(applying a similar test to determine whether tolls are taxes

or user fees).

1.   The Tolls Provide a Particularized Benefit to Users of the
                         Project Facilities

     Project facility users pay tolls in exchange for a

particularized benefit.   As detailed in VDOT's Project

Management Plan, VDOT and ERC will use toll revenues to make

improvements to each individual Project facility.   Tolls will

fund significant improvements to the Midtown Tunnel, including

"new roadways, drainage, communications/intelligent

                                14
transportation systems, lighting, flood protection, fire

detection and suppression, ventilation, and power control

systems."   The improvements will reduce congestion on, and

provide greater emergency access to, the Midtown Tunnel.    The

toll revenues will also help fund construction of the MLK

Extension, which will "provide improved access to and from West

Norfolk and [will] serve as an alternate route for I-264

traffic when the Downtown Tunnel is congested."    Users of the

Downtown Tunnel will benefit from "modifications to the

existing northbound and southbound tunnels necessary for the

existing facility to conform to the National Fire Protection

Standard 502."   These modifications include "upgrades to: the

existing water supply, ventilation, electrical, and emergency

response systems."

     Improvements to the individual facilities will also

benefit the integrated transportation network as a whole.     The

General Assembly has recognized vehicular connections between

Portsmouth and Norfolk by bridge or tunnel as an integrated

network since 1942 when it enacted the Elizabeth River Tunnel

Revenue Bond Act ("Elizabeth River Act").   1942 Acts ch. 130.

The Elizabeth River Act granted the Elizabeth River Tunnel

Commission the authority to "establish, construct, operate, and

maintain the project."   Id. (emphasis added).    The project was

defined as "a tunnel or tunnels under the Elizabeth River or a

                                15
bridge over and a tunnel under the South Branch of the

Elizabeth River and a tunnel under or a bridge over the East

Branch of the Elizabeth River, forming a vehicular connection

between the cities of Portsmouth and Norfolk, Virginia."     Id.

(emphasis added).

       In 1952, the Downtown Tunnel was constructed as part of

the "project."   Several years later, in 1956, the General

Assembly approved the construction of another tunnel, the

Midtown Tunnel, which the General Assembly explicitly added to

the Elizabeth River Act's definition of "project."    Acts 1956

ch. 285.   In 1971, the General Assembly recognized the need for

a third vehicular connection between Portsmouth and Norfolk.

It authorized the Elizabeth River Tunnel Commission to

construct "a tunnel or tunnels or a bridge or bridges under or

over the Elizabeth River and any tributaries thereof and

approaches and approach roads . . . thereto."   Acts 1971 ch.

237.   The General Assembly again expanded the Elizabeth River

Act's definition of "project" to include any of the

aforementioned additional vehicular connections.   Id.   Thus,

the General Assembly has historically recognized vehicular

connections between Portsmouth and Norfolk and approaches to

the connections as an integrated network and unified project.

       The Project at issue, although created under the later-

enacted PPTA, is merely a new adaption of the historically

                                 16
recognized unified project.    A 1996 Final Environmental Impact

Statement indicates that new improvements to the Project

facilities will provide benefits to the Project as a whole,

including "improved overall traffic flow, an increase in

traffic capacity, and a decrease in travel time."    The Official

Offering Statement of the Virginia Small Business Financing

Authority specifies that these improvements will also

"accommodate growing regional traffic volumes, reduce

congestion and provide improved links between employment

centers, airports, freight, marine terminals, rail lines and

other existing transit facilities by providing increased

capacity for crossing the Elizabeth River and also by improving

linkage to the regional highway system."    The users of each of

the Project facilities will, by paying the toll, gain a

particularized benefit from improvements to the particular

facility to which the toll payment provides access, as well as

from improvements to the Project as a whole.

 2.    Drivers Are Not Compelled by Government to Pay the Tolls
           or Accept the Benefits of the Project Facilities

      The government does not compel those who cross the

Elizabeth River to pay a toll or accept the benefits provided

by the Project facilities.    Project facility users' toll

payments are therefore voluntary.     There are two aspects of

voluntariness in the case at bar.     First, there are reasonable

                                 17
alternative routes of passage between Portsmouth and Norfolk

available to users of the Downtown Tunnel and Midtown Tunnel.

Reasonable alternatives include the Gilmerton Bridge and the

High Rise Bridge, neither of which impose a toll on users.

     Second, because drivers who choose not to use the toll

roads do not receive the aforementioned benefits of the

Project, they are not compelled to accept the benefit of a fee

that they are not paying.   This is in contrast to a tax, such

as a sales tax, in which the individual purchaser's decision

regarding whether to purchase the item has no effect on whether

the purchaser will receive a benefit from sales taxes through

government services supported by the sales taxes.   Even though

the purchaser's payment of the sales tax may be voluntary,

receipt of the benefit is not.

     The user of a toll road, on the other hand, pays a user

fee in exchange for a direct benefit that the user would give

up if he did not pay the fee.    National Cable Television Ass'n

v. United States, 415 U.S. 336, 340-41 (1974) ("A fee . . . is

incident to a voluntary act [which] bestows a benefit on the

applicant, not shared by other members of society").   The

government does not compel either the payment or the benefit,

and thus the fee is voluntary and contractual.

                                 18
3. The Tolls Are Collected Solely to Fund the Project

     Finally, the tolls are collected solely to fund the

Project.   We have previously held that an ordinance "is not an

invalid revenue-generating device solely because the fee set by
                                      2
the ordinance generates a surplus."       Mountain View Ltd. P'ship

v. City of Clifton Forge, 256 Va. 304, 312, 504 S.E.2d 371, 376

(1998).    Rather, the ordinance constitutes an invalid revenue-

generating device if there is no "reasonable correlation

between the benefit conferred and the cost exacted by the

ordinance."    Id.   In the present case, the costs of the Project

exceed the fees imposed on users of the Project facilities and,

consequently, the tolls are not an invalid revenue-generating

device.

     Moreover, the Comprehensive Agreement restricts the use of

toll revenues to funding of the Project.     Section 5.06 of the

Comprehensive Agreement provides that "[ERC] will have no right

to use Gross Revenues to pay any debt, obligation or liability

unrelated to this Agreement, the Project, or [ERC's] services

pursuant to this Agreement."    If ERC were to attempt to use

revenues from the Project for separate, unrelated purposes by

"imposing tolls in excess of that permitted pursuant to [the

     2
       Tolls for the funding of a project are user fees when
they fund not only the project's cost, but also "the return
which such values or expenditures should yield." Sands, 123
U.S. at 294.

                                 19
Comprehensive] Agreement," the Comprehensive Agreement provides

that:

             such . . . Default will be curable only by
             (i) reinstating the tolls in effect
             immediately prior to the impermissible raise
             in tolls, unless waived by [VDOT] and (ii)
             disgorging to [VDOT] any and all increases
             in Toll Revenues that would not have been
             realized in the absence of such [ERC]
             Default, together with interest thereon at
             the Bank Rate from the date of collection
             until the date disgorged.

Section 19.02(d) (emphasis added).

        Any disgorgement to VDOT under Section 19.02 of the

Comprehensive Agreement does not remain with VDOT, nor is it

dispersed to unrelated projects.       Rather, the Code provides that

any excess would be diverted to the Transportation Trust Fund.

Code § 33.1-23.03:1(9).     Funds provided to the Transportation

Trust Fund from facilities developed under the PPTA are "held in

a separate subaccount" in the Transportation Trust Fund and are

to be used only to:

          1. Pay or finance all or part of the costs of
             programs or projects . . . that are
             reasonably related to or benefit the users
             of the qualifying transportation facility
             that was the subject of a concession
             pursuant to the [PPTA].

                                . . . .

          2. Repay funds from the Toll Facilities
             Revolving Account or the Transportation
             Partnership Opportunity Fund[, or]

                                  20
       3. Pay the Board's reasonable costs and
          expenses incurred in the administration and
          management of the account.

Code § 33.1-23.03:9(A)-(B) (emphasis added).   The record is

therefore sufficient to establish that all revenue derived from

Project tolls would fund the Project.

     Accordingly, we hold that tolls on the Midtown Tunnel,

Downtown Tunnel, and MLK Extension, which are (1) paid in

exchange for a particularized benefit, (2) not compelled by

government, and (3) collected solely to fund the Project are

user fees, not taxes.

C.   Whether the General Assembly Unconstitutionally Delegated
     the Authority to Set Toll Rates to Public and Private
     Entities in the PPTA

     Meeks assigns cross-error to the circuit court's refusal

to enter summary judgment in his favor on Counts 1 and 2 of the

Complaint for the alternative reason that the PPTA

unconstitutionally delegates to public and private entities the

General Assembly's authority to set toll rates.   Meeks argues

that the PPTA violates Article IV, § 1 of the Constitution of

Virginia because it authorizes public and private entities to

set toll rates on the same project from which the private

entity will derive a return on its investment.    Article IV, § 1

provides, "[t]he legislative power of the Commonwealth shall be

vested in a General Assembly, which shall consist of a Senate

and House of Delegates."   Meeks contends that the ratemaking at

                                21
issue is a wholly legislative function within the jurisdiction

of the State Corporation Commission ("SCC").    Meeks argues that

the PPTA impermissibly delegates ratemaking authority to VDOT,

a state agency that lacks true legislative power.

     We disagree.    The SCC does not hold regulatory authority

over toll rate setting in projects authorized by the PPTA.      It

is well established that the SCC "has no inherent power simply

because it was created by the Virginia Constitution; and

therefore its jurisdiction must be found either in

constitutional grants or in statutes which do not contravene

that document."    VYVX of Va., Inc. v. Cassell, 258 Va. 276,

290, 519 S.E.2d 124, 131 (1999) (internal quotation marks

omitted).    Neither the Constitution nor the Code provides the

SCC with jurisdiction over toll rate setting for the Project.

     Section 156(b) of Article XII of the Constitution of

Virginia of 1902 3 clearly and unambiguously delegated regulatory

     3
         Section 156(b) provided, in relevant part:

            The [SCC] shall have the power, and be
            charged with the duty, of supervising,
            regulating and controlling all
            transportation and transmission companies
            doing business in this State, in all matters
            relating to the performance of their public
            duties and their charges therefor, and of
            correcting abuses therein by such companies;
            and to that end the [SCC] shall, from time
            to time, prescribe, and enforce against such
            companies, in the manner hereinafter
            authorized, such rates, charges,

                                 22
authority over "transportation . . . companies doing business"

in the Commonwealth to the SCC.    Thus, if it were still in

effect, Section 156(b) of the Constitution of Virginia of 1902

would have placed ERC, a transportation company doing business

in the Commonwealth, within the jurisdiction of the SCC's

constitutionally delegated authority.

     However, in 1971, the General Assembly enacted the present

Constitution of Virginia through a complete revision of its

predecessor, the Constitution of Virginia of 1902.   With this

change, Section 156(b) of the Constitution of Virginia of 1902

became Article IX, § 2 of the present Constitution of Virginia

of 1971, which currently provides, in relevant part:

          Subject to such criteria and other
          requirements as may be prescribed by law,
          the [SCC] shall have the power and be
          charged with the duty of regulating the
          rates, charges, and services and, except as
          may be otherwise authorized by this
          Constitution or by general law, the
          facilities of railroad, telephone, gas, and
          electric companies.

          classifications of traffic, and rules and
          regulations, and shall require them to
          establish and maintain all such public
          service, facilities and conveniences, as may
          be reasonable and just, which said rates,
          charges, classifications, rules, regulations
          and requirements, the [SCC] may, from time
          to time, alter or amend.

(Emphasis added.)

                                  23
(Emphasis added.)   When the "words [and] terms" of a provision

of the Constitution are not "doubtful or ambiguous," "we are

limited to the language of the section itself and are not at

liberty to search for meaning, intent or purpose beyond the

instrument."   Harrison v. Day, 200 Va. 439, 448, 106 S.E.2d 636,

644 (1959).    Article IX, § 2 delegates jurisdiction over rates,

charges, and services of railroad, telephone, gas, and electric

facilities to the SCC.   This list of facilities is exclusive.

Thus, with the enactment of the present Constitution of Virginia

in 1971, the facilities within the SCC's regulatory authority no

longer include "transportation . . . companies doing business in

this State."

     Just as the Constitution of Virginia does not delegate

jurisdiction over transportation companies to the SCC, neither

has the General Assembly delegated such jurisdiction over the

Project to the SCC.   The authority to authorize and regulate

toll roads throughout the Commonwealth is addressed in the

Virginia Highway Corporation Act of 1988, Code § 56-535 et seq.

("VHCA") and in the PPTA.

     The VHCA provides that "[n]o person may construct,

operate[,] or enlarge any [privately owned or operated highway

for which a toll is imposed] without first having obtained a

certificate of authority from the [SCC] authorizing such

construction, operation[,] or enlargement."   Code § 56-538; see

                                 24
also Code §§ 56-536, 56-542.      Thus, the VHCA granted the SCC the

authority to authorize and regulate toll roads throughout the

Commonwealth.

        However, the PPTA, enacted by the General Assembly in 1995,

provides that "[n]othing in the [VHCA] shall apply to qualifying

transportation facilities undertaken pursuant to the authority

of this chapter."      Code § 56-574.    Although the VHCA authorized

the SCC to have regulatory jurisdiction generally over

transportation facilities, the PPTA carved out an exception for

qualifying transportation facilities undertaken pursuant to the

PPTA.       Id.; see also Code § 56-560.

        We hold that neither the Constitution of Virginia nor the

Code supplies the SCC with jurisdiction over toll rate setting

in projects authorized by the PPTA.        The General Assembly was

therefore not required to delegate any legislative power

employed in the execution of the Project exclusively to the SCC.

D.      Whether Extending the Legislative Power to Impose and Set
        the Rates of User Fees to VDOT and ERC Was Constitutional

        We now turn to the constitutionality of the legislative

power to impose and set the rates of user fees being extended

to VDOT and ERC. 4     At all times in the discussion below, unless

        4
       The issue of the legislative power to impose and set the
rates of user fees being extended to VDOT and ERC is one of
Virginia constitutional law, and one resolved by state-law
principles. This Court has, over time, looked to federal law
to help provide guiding principles or to exemplify a point.

                                    25
otherwise indicated, the "legislative power" specifically being

addressed is the power to impose user fees in the form of tolls

and the power to set the rates of those tolls.

     In addressing this issue, we are not evaluating—and indeed

cannot speak to—the merits of the various policy decisions

underlying this case.   Our role is simply to ascertain whether

the political entities have acted within the constitutional

boundaries that limit the exercise of their governmental power.

If so, then their policy decisions are subject to, and properly

evaluated by, the political will of the people, and we have no

authority to override such political decisions.   See Williamson

v. Old Brogue, Inc., 232 Va. 350, 354, 350 S.E.2d 621, 624

(1986) ("Where, as here, the issue involves many competing

economic, societal, and policy considerations, legislative

procedures and safeguards are particularly appropriate to the

task of fashioning an appropriate change."); Commonwealth v.

County Board, 217 Va. 558, 581, 232 S.E.2d 30, 44 (1977)

("Conscious of the respective roles of the General Assembly and

See, e.g., DuVal v. Virginia Elec. & Power Co., 216 Va. 226,
228-29, 217 S.E.2d 844, 846-47 (1975) (discussing American
Power & Light Co. v. Securities & Exch. Comm'n, 329 U.S. 90
(1946)). Resolving the constitutional propriety of extending
state legislative power to both public and private entities,
however, is a state-law issue not compelled by, or necessarily
coextensive with, federal jurisprudence. See Michigan v. Long,
463 U.S. 1032, 1040-41 (1983).

                                26
the judiciary, we decline to intrude upon . . . a singularly

political question."   (internal quotation marks omitted)).

      Evaluating the extension of legislative power to VDOT and

ERC requires resolving two issues.   First, whether extending

the legislative power to VDOT and ERC is constitutionally

permissible.   Second, if such an extension of the legislative

power is constitutional, whether that extension was done

correctly.   We address these points in turn.

 1.   The Legislative Power to Impose and Set the Rates of User
      Fees May Be Constitutionally Extended to VDOT and ERC

      The Legislative, Executive, and Judicial Branches are

"separate and distinct" under the Constitution of Virginia.

Va. Const. art. I, § 5; Va. Const. art. III, § 1.   This

directive "prevents one branch from engaging in the functions

of another."   Taylor v. Worrell Enterprises, Inc., 242 Va. 219,

221, 409 S.E.2d 136, 138 (1991); see, e.g., Board of

Supervisors v. Allman, 215 Va. 434, 445, 211 S.E.2d 48, 55

(1975) (courts cannot rezone property because the

"classification of lands under zoning ordinances involves the

exercise of the legislative power" of the Commonwealth); Fugate

v. Weston, 156 Va. 107, 116-17, 157 S.E. 736, 739 (1931) (the

General Assembly cannot vest the Governor with the power to

suspend or remove an officer without subsequent judicial

adjudication because "the requisite jurisdictional facts

                                27
necessary to sustain [such an action] is always essentially a

judicial function").    Therefore, because "[t]he legislative

power of the Commonwealth" is "vested in a General Assembly,"

Va. Const. art. IV, § 1, the General Assembly is the branch of

government that wields legislative power.

     However, we have long recognized that the separation of

powers between the branches of government is not absolute.

See, e.g., Thompson v. Smith, 155 Va. 367, 381, 154 S.E. 579,

584 (1930).    Practical considerations of modern governance

require some degree of intermixing governmental powers between

branches.     See Baliles v. Mazur, 224 Va. 462, 472, 297 S.E.2d

695, 700 (1982) ("[T]here is not a single constitution of any

state in the [U]nion which does not practically embrace some

acknowledgement of the [separation of powers] maxim and at the

same time some admixture of powers constituting an exception to

it." (internal quotation marks omitted)).    This is particularly

true in the area of the Executive Branch's administration and

enforcement of law enacted by the General Assembly.    As we have

acknowledged, "[g]overnment could not be efficiently carried on

if something could not be left to the judgment and discretion

of administrative officers to accomplish in detail what is

authorized or required by law in general terms."    Thompson, 155

Va. at 379, 154 S.E. at 584.

                                 28
 a.     The General Assembly Can Delegate to VDOT the Legislative
           Power to Impose and Set the Rates of User Fees

        We first evaluate the General Assembly's extension of the

legislative power to impose and set the rates of user fees to

VDOT under the PPTA.    This extension of legislative power is

that most commonly encountered in modern governance, and is

easily categorized as a delegation of legislative power to

VDOT.    For the reasons set forth below, we hold that this

delegation of legislative power to VDOT is constitutionally

permissible.

        The General Assembly's legislative powers are "without

limit," restricted only by express or necessarily implied

prohibitions arising from the Constitution of Virginia or the

United States Constitution.     Marshall v. Northern Virginia

Transp. Auth., 275 Va. 419, 432, 657 S.E.2d 71, 78 (2008);

Harrison, 201 Va. at 396, 111 S.E.2d at 511.    In the exercise

of its broad, plenary power, the General Assembly can generally

delegate its legislative powers to Executive Branch

administrative agencies such as VDOT.     Taylor, 242 Va. at 221,

409 S.E.2d at 137-38.    Some types of legislative powers,

however, are removed from this broad authority and cannot be

freely delegated.    When determining whether a particular

legislative power can be delegated to an administrative agency,

this Court "consider[s] the explicit language of the

                                  29
Constitution [of Virginia]."   Marshall, 275 Va. at 432, 657

S.E.2d at 78.   Meeks makes two arguments as to why the General

Assembly's delegation of the legislative power to impose and

set the rates of user fees to VDOT is constitutionally infirm.

      First, Meeks argues that the Project tolls are taxes.    If

the Project tolls were taxes, then the General Assembly's

delegation of the power to impose and set the rates of such

taxes to VDOT would be a constitutionally impermissible

delegation of legislative power.      Id. at 435, 657 S.E.2d at 79-

80.   But as discussed extensively above in Part II.B., the

Project tolls are not taxes.   The Project tolls are user fees.

The constitutional prohibition against delegating the

legislative power to impose and set the rates of taxes does not

apply to the legislative power to impose and set the rates of

user fees.

      Second, Meeks argues that the power to impose and set the

rates of the Project tolls is a wholly legislative function

that can only be delegated to the SCC and not to an Executive

Branch administrative agency like VDOT.     But as discussed

extensively above in Part II.C., the SCC is not the only entity

to which the legislative power to impose and set the rates of

user fees can be delegated.    The mere existence of the SCC does

not create a constitutional barrier prohibiting the General

                                 30
Assembly from delegating the legislative power to impose and

set the rates of user fees to an administrative agency.

       Thus considered, the General Assembly is not prohibited by

either the Constitution or the Code from delegating the

legislative power to impose and set the rates of user fees to

the administrative agency VDOT.

  b.   The General Assembly Can Empower ERC to Assist VDOT in
Exercising the Legislative Power to Impose and Set the Rates of
                           User Fees

       We now evaluate the General Assembly's extension of the

legislative power to impose and set the rates of user fees to

ERC.   This extension of legislative power is different than a

typical delegation of legislative power to an administrative

agency, but is implicated here by the PPTA.   For the reasons

set forth below, this extension of the legislative power to ERC

(an "empowerment") is of a different kind than the extension of

the legislative power to VDOT (a "delegation").

       When the General Assembly delegates a legislative power

directly to a private entity, "[t]his is legislative delegation

in its most obnoxious form."   Carter v. Carter Coal Co., 298

U.S. 238, 311 (1936).   The Supreme Court of the United States

has held that when Congress delegates its legislative power to

regulate an aspect of a specific industry to a private entity

engaged in that very industry, that delegation offends the

United States Constitution.    Id. at 310-12 (Congress cannot

                                  31
delegate power to "fix maximum hours of labor" in the coal-

mining industry to specified coal producers).    But a private

entity's mere involvement with making regulatory decisions,

falling below actual delegation of legislative power, is not

itself unconstitutional.   For example, if Congress empowers a

private entity to help regulate an aspect of a specific

industry, but that private entity's authority is subordinate to

a public entity's decision-making power, then the empowerment

is constitutionally permissible.     Sunshine Anthracite Coal Co.

v. Adkins, 310 U.S. 381, 388, 399 (1940) (Congress can empower

private entities to "propose minimum prices pursuant to

prescribed statutory standards" because those proposals were

subject to the National Bituminous Coal Commission's approval).

     Our previous decisions align with these principles.    See,

e.g., County of Fairfax v. Fleet Indus. Park Ltd. P'ship, 242

Va. 426, 432-33, 410 S.E.2d 669, 672-73 (1991) (holding that a

legislative enactment, allowing private landowners to

unilaterally veto zoning classifications as well as ordinances

and regulations affecting property, was an impermissible

delegation of legislative power because it gave the private

parties "total discretion"); Chesapeake & Potomac Tel. Co. of

Virginia v. Arlington Cnty., 213 Va. 339, 341, 192 S.E.2d 772,

774 (1972) (holding that a private telephone company's

increased rates, when never properly authorized by the SCC,

                                32
"were company-made rates and increases" that violated both

Virginia constitutional and statutory provisions).   We

therefore make explicit that, under the Constitution of

Virginia, the General Assembly may empower private entities to

assist public entities in the exercise of constitutionally-

delegated legislative powers, but the General Assembly cannot

delegate such legislative powers directly to private entities. 5

     With these governing principles in mind, the PPTA is

reviewed to determine whether ERC's involvement "in the

administrative process" has become so prominent and without

sufficient VDOT oversight that ERC's "role [has] trespass[ed]

into an unconstitutional delegation."   Association of Am. R.R.

v. United States Dep't. of Transp., 721 F.3d 666, 671 (D.C.

Cir. 2013).   In the PPTA, the General Assembly extended

     5
       This divide between delegation and empowerment is
encapsulated in our previous decisions regarding when a
legislative power has been impermissibly delegated to the
private sector. However, we borrow the term "empower" as a
means of contrasting a "delegation" from a related delegation
context.
     In Ex Parte Bassitt, 90 Va. 679, 680 (1894), we evaluated
the General Assembly's extension of the legislative power to
appoint additional judicial officers between elections, if "the
public service" so required, to county courts. We held that
this extension of power was not a delegation of legislative
power. Id. at 681. Instead, we recognized that "the county
courts [were] merely empowered to declare the event . . . upon
which the act is to take effect within their respective
counties." Id. (emphasis added). Thus, we recognized that the
General Assembly can empower other entities to be involved in
the exercise of legislative power, but such empowerment falls
short of a delegation of legislative power.

                                33
directly to ERC some degree of authority to be involved with

the legislative power to impose and set the rates of user fees.

See, e.g., Code § 56-565(D) (allowing a private entity to make

different "classifications" for assessing user fees); Code

§ 56-566(A) (directing VDOT and ERC to "enter into a

comprehensive agreement"); Code § 56-566(B) (requiring a

comprehensive agreement to "provide for such user fees" that

the parties establish "from time to time by agreement," and for

the parties to "negotiat[e] user fees").   The PPTA, then, does

allow ERC to have a role regarding the legislative power.     But

that role is subordinate to VDOT's ultimate decision-making

authority.

     Indeed, the comprehensive agreement which dictates the

exercise of the legislative power to impose and set the rates

of user fees is subject to VDOT's approval.   Nothing in the

PPTA compels VDOT to enter into a comprehensive agreement

containing terms to which VDOT does not assent.   This means

that VDOT has the option of ultimately rejecting the

comprehensive agreement and looking for another proposal

submitted by a different private entity.   Such a rejection

could be, amongst other reasons, because of the private

entity's unwillingness to submit to VDOT's determination

regarding user fees.

                               34
        Meeks is correct in asserting that the Comprehensive

Agreement, being a contract, must be made while VDOT and ERC

stand on relatively equal footing as a matter of contract

principles.    See Envirotech Corp. v. Halco Eng'g, Inc., 234 Va.

583, 593, 364 S.E.2d 215, 220 (1988) (holding that "grossly

unequal bargaining power at the time the contract is formed"

can render a contract unconscionable).     But VDOT retains the

ultimate authority governing the progress of any given project

by deciding which particular comprehensive agreement will be

controlling.    This power to reject a comprehensive agreement

carries with it the power to shape the terms of the

comprehensive agreement, including those terms relating to the

legislative power to impose and set the rates of user fees.

        It is clear, then, that VDOT holds the ultimate power to

establish the terms of a comprehensive agreement under the

PPTA.    This includes those terms regarding the exercise of the

legislative power.    The General Assembly does allow private

entities such as ERC to contract and negotiate with VDOT in

deciding what those terms are.    But ERC has no ability to force

VDOT to actually enter into such a comprehensive agreement.

The General Assembly has therefore only empowered ERC, and has

not delegated the legislative power to impose and set the rates

of user fees to ERC.    Thus considered, the General Assembly can

constitutionally extend the legislative power to ERC, as a

                                  35
private entity, to assist VDOT in imposing and setting the

rates of user fees, because here it is a mere empowerment and

not a delegation of legislative power.

  c.   VDOT Can Authorize ERC to Be Involved in the Exercise of
 the Legislative Power to Impose and Set the Rates of User Fees

     We finally evaluate VDOT's extension of the legislative

power to impose and set the rates of user fees to ERC.   This

extension of legislative power is unique to the public

entity/private entity collaboration context, and is implicated

here by VDOT having authorized, through contract, ERC to

exercise some degree of the legislative power in the

Comprehensive Agreement.   For the reasons set forth below, this

extension of the legislative power to impose and set the rates

of user fees is only a mere empowerment and not a delegation.

     The principles pertaining to the delegation/empowerment

dichotomy are equally applicable here.   This is true even

though the schemes in the cases setting forth those principles

are not directly on point.   In contrast to the aforementioned

cases, the current issue is not whether the General Assembly,

through the PPTA, has directly delegated to or empowered ERC to

engage in the exercise of legislative power.   The issue is

whether VDOT, having been delegated the legislative power to

impose and set the rates of user fees by the General Assembly,

                                36
may subsequently authorize ERC, through contract, to exercise a

degree of that legislative power.

     Despite these factual differences, the two schemes

parallel one another.   That is, VDOT's authorizing ERC to

exercise the legislative power is substantially similar to the

scenario of the General Assembly's directly delegating to a

private entity, or empowering a private entity with, a

legislative power.   In fact, because the General Assembly

delegated the legislative power to VDOT, VDOT's authorizing ERC

to exercise that legislative power can be fairly described as

being done on the General Assembly's behalf.      It would be a

poor check on impermissible delegation if administrative

agencies could extend legislative powers in a manner in which

the General Assembly could not.    See Marshall, 275 Va. at 435,

637 S.E.2d at 80 ("The General Assembly also may not accomplish

. . . indirectly[] that which it is not empowered to do

directly.").

     The issue here is therefore sufficiently comparable to a

scenario in which the General Assembly directly delegates a

legislative power to a private entity or empowers a private

entity with a legislative power.       We therefore make explicit

that, under the Constitution of Virginia, an administrative

agency may empower private entities (through contractual

arrangements) to assist it in the exercise of constitutionally-

                                  37
delegated legislative powers, but an administrative agency

cannot delegate such legislative powers to private entities.

     As with the PPTA, then, the Comprehensive Agreement is

reviewed to determine whether ERC's involvement "in the

administrative process" has become so prominent and without

sufficient VDOT oversight that ERC's "role [has] trespass[ed]

into an unconstitutional delegation."    American R.R., 721 F.3d

at 671.   The Comprehensive Agreement makes clear that ERC does

not exercise unilateral discretion in imposing and setting the

rates of the user fees.    True, ERC has the "exclusive right"

and "obligation" to impose and establish the Project tolls.

But that power must conform to the other terms of the

Comprehensive Agreement.

     The Comprehensive Agreement requires the Project tolls to

be set and raised in accordance with the Toll Rate Schedule.

The Toll Rate Schedule—a document which VDOT negotiated with

ERC, and which VDOT could have rejected—sets maximum

transponder and non-transponder rates.   So ERC's ability to

exercise the legislative power to impose and set the rates of

user fees is confined by limits which VDOT has expressly

created by setting maximum toll rates.   Moreover, ERC must give

VDOT notice 60 days before any planned Project toll rate

adjustment.   VDOT therefore retains constant oversight of ERC's

exercise of the legislative power to impose and set the rates

                                 38
of user fees.   In addition, VDOT retains the right, "in its

sole discretion," to immediately stop the imposition of Project

tolls in certain emergencies.

       ERC's ability to impose and set the rates of the Project

tolls is more than merely advisory.    But VDOT retains a

pervasive role in setting the limits on, and constantly

reviewing, ERC's use of the legislative power.    This makes

ERC's ability to exercise the legislative power sufficiently

subordinate to VDOT's decision-making authority for purposes of

determining whether VDOT can authorize ERC to exercise some

degree of that legislative power.     See American R.R., 721 F.3d

at 671 n.5 (reviewing multiple federal circuit court decisions

that evaluated regulatory schemes involving private entities

and holding that the defining characteristic making such

schemes constitutionally permissible was that "a private party

[did not] stand on equal footing with a government agency").

       This determination is confirmed by Harrison, where we were

presented with the General Assembly's creation of the Virginia

State Ports Authority and delegation to the Ports Authority the

legislative power "to fix and revise charges for the use of the

port facilities under its control."    202 Va. at 977, 121 S.E.2d

622.   The Ports Authority subsequently entered into a contract

which, in part, leased a facility to a private railroad

company.    Id. at 970, 977, 121 S.E.2d at 617, 622.   A provision

                                 39
of this lease contracted away to the private railroad company

the power to fix and enforce "the rates and regulations" for

use of the leased facility, a legislative power originally

delegated to the Ports Authority.      Id. at 977, 121 S.E.2d at

622.   Under that lease contract, the railroad company's rates

and regulations were presumptively valid unless an unspecified

"governmental body" determined those rates and regulations "to

be unfair or unlawful."    Id.   In reviewing a challenge of this

contractual situation as being "an unlawful delegation of the

[Ports] Authority's responsibility" to a private entity, we

observed that "[t]he General Assembly obviously did not think

so," and simply held that "there is no substance to the point."

Id. at 978, 121 S.E.2d at 622.

       Such a summary dismissal of an identical challenge

confirms the constitutionality of VDOT's authorizing ERC,

through contract, to exercise the legislative power to impose

and set the rates of user fees.    The Harrison situation is

analogous to the Comprehensive Agreement between VDOT and ERC.

If anything, VDOT's confining the universe of ERC's potential

actions with hard limits and continuing supervision of ERC's

ability to adjust the Project tolls provides a greater degree

of public entity oversight than that which existed in Harrison.

       Thus considered, in the Comprehensive Agreement VDOT can

authorize ERC to exercise the legislative power to impose and

                                  40
set the rates of user fees—a legislative power originally

delegated from the General Assembly to VDOT—because here it is

a mere empowerment and not a delegation of legislative power.

  2.    The Extension of the Legislative Power to Set User Fees
                  Was Appropriately Accomplished

  a.   The General Assembly Delegated the Legislative Power to
  VDOT with Constitutionally Sufficient Policies and Standards

       The General Assembly's ability to delegate its legislative

power is not absolute.   A delegation of legislative power

allowing for discretionary exercise of that power is not, in

and of itself, constitutionally impermissible.      See DuVal, 216

Va. at 228, 217 S.E.2d at 846.      However, "delegations of

legislative power are valid only if they establish specific

policies and fix definite standards to guide the official,

agency, or board in the exercise of the power."      Bell v. Dorey

Elec. Co., 248 Va. 378, 380, 448 S.E.2d 622, 623 (1994).

Absent such policies and standards, a delegation of legislative

power is unconstitutional.    Id.

       Constitutionally sufficient policies and standards are

those "where the terms or phrases employed have a well

understood meaning, and prescribe sufficient standards to guide

the administrator."   Id. at 382, 448 S.E.2d at 624 (citation

omitted).   The standards "must be as reasonably precise as the

subject matter requires or permits."      Ours Props., Inc. v. Ley,

198 Va. 848, 851, 96 S.E. 754, 757 (1957).      But, general terms

                                 41
are permissible if those terms "get precision from the

technical knowledge or sense and experience of men and thereby

become reasonably certain."   Id. at 852, 96 S.E.2d at 757. 6

     The legislative power at issue is the ability to impose

and set the rates of user fees.    VDOT is correct in declaring

that this is a "matter[] of detail [that] may properly be left

to administrative discretion."    Thompson, 155 Va. at 381, 154

S.E. at 584.   But this could not excuse a lack of

constitutionally sufficient policies and standards, as VDOT

argues.   It is because VDOT can exercise administrative

discretion in the exercise of a delegated legislative power

that constitutionally sufficient policies and standards

governing that discretion are required.    Id.

     6
       Meeks asserts that a delegation of legislative power,
when the General Assembly contemplates that power to be shared
to some degree with a private entity, must be accompanied by
policies and standards that are even more precise than
generally required. No authority supports this proposition.
This proposition does not align with the purposes of requiring
specific policies and standards. See Yakus v. United States,
321 U.S. 414, 426 (1944) ("[S]tandards [must be] sufficiently
definite and precise to enable Congress, the courts[,] and the
public to ascertain whether the [administrative agency] has
conformed to those standards."); Chapel v. Commonwealth, 197
Va. 406, 410, 89 S.E.2d 337, 340 (1955) (holding that standards
to guide administrative discretion ensure that the General
Assembly does not "divest itself of [the] function" to
"determine and declare what the law shall be"). Such a
proposition would further confuse an already murky
jurisprudential area to the point of removing any real
standards for a reviewing court to apply. We therefore reject
this proposition.

                                  42
     Therefore, we must evaluate those sources that might

establish such policies and standards.   For this inquiry, VDOT

invokes both federal law and judicially imposed limitations on

the exercise of the legislative power to impose and set the

rates of user fees.   But we look no further than the operative

legislation: the PPTA itself.   See Volkswagen of Am., Inc. v.

Smit, 279 Va. 327, 340, 689 S.E.2d 679, 687 (2010) ("[T]he

legislature may delegate discretion to an administrative

officer to determine the specifics of how a statute is to be

enforced, but the legislature must declare the policy of the

law and fix the legal principles which are to control in given

cases." (emphasis added) (internal quotation marks and

alteration omitted)).

     In fact, our review begins and ends with Code § 56-566(B).

Code § 56-566(B) directs the comprehensive agreement to set

forth the terms of imposing and setting the rates of user fees.

In particular, specific guidance is provided for when parties

are "negotiating user fees under this section."   Code § 56-

566(B).   That guidance commands that "the parties shall

establish [user] fees that are the same for persons using the

facility under like conditions except as required by agreement

between the parties to preserve capacity and prevent congestion

on the qualifying transportation facility."   This consideration

governs any exercise of the legislative power to impose or set

                                43
the rates of user fees. 7   Further, this consideration requires

VDOT to consider whether the imposition and rates of the user

fees will preserve capacity and prevent congestion.    By the

terms of Code § 56-566(B), then, VDOT's exercise of the

legislative power is guided by the directive to preserve

capacity and prevent congestion.

     Moreover, terms such as "capacity" and "congestion" are

industry-specific goalposts.    We have long held such standards

to be constitutionally sufficient.    See Reynolds v. Milk Comm'n

of Virginia, 163 Va. 957, 965, 975, 179 S.E. 507, 509-10, 514

(1935) (upholding a statute allowing the Milk Commission to fix

reasonable prices, whereby reasonableness is informed by

industry-specific costs, charges, and prices).

     Thus considered, we hold that Code § 56-566(B) provides

constitutionally sufficient policies and standards to govern

the exercise of the legislative power: both the power to impose

     7
       This clause appears to be conditioned on the "agreement
between the parties." Code § 56-566(B). However, we read "to
preserve capacity and prevent congestion on the qualifying
transportation facility" as being a constant consideration that
must be addressed by VDOT in the exercise of the legislative
power to impose and set the rates of user fees. See Copeland
v. Todd, 282 Va. 183, 193, 715 S.E.2d 11, 16 (2011) ("[W]e have
a duty to construe statutes subject to a constitutional
challenge in a manner that avoid[s] any conflict with the
Constitution." (internal quotation marks omitted)).
     The agreement of the parties—that is, the Comprehensive
Agreement which sets forth all aspects of exercising the
legislative power—merely serves as the vehicle through which
that consideration is addressed.

                                 44
user fees and the power to set the rates of user fees.      These

policies and standards are sourced in the mandatory requirement

that VDOT exercise the legislative power in order "to preserve

capacity and prevent congestion."      Code § 56-566(B).   We need

not evaluate whether other considerations within Code § 56-

566(B) supply constitutionally sufficient policies and

standards.    The General Assembly's mandatory guidance that

VDOT's exercise of the legislative power to impose and set the

rates of user fees shall preserve capacity and prevent

congestion, standing alone, provides sufficient policies and

standards to satisfy the constitutional requirement discussed

here.    On this point, the circuit court erred.

    b.      ERC Being Empowered, and Not Delegated To, Does Not
              Require Accompanying Policies and Standards

        The requirement of constitutionally sufficient policies

and standards is one that accompanies the delegation of

legislative power.    See Volkswagen of America, 279 Va. at 339-

40, 689 S.E.2d at 686.    Such a requirement does not extend to

the empowerment of a private entity to be involved in the

exercise of a legislative power.

        As discussed above in Part II.D.1.b., the General Assembly

did not delegate the legislative power to impose and set the

rates of user fees to ERC, but only empowered ERC to assist

VDOT through the PPTA.    And as discussed above in Part

                                  45
II.D.1.c., VDOT did not delegate that legislative power to ERC,

but merely empowered ERC to assist VDOT in the Comprehensive

Agreement.   As such, because ERC has not been delegated a

legislative power, no requirement exists that constitutionally

sufficient policies and standards must accompany ERC's

empowerment.

E.   Whether the Comprehensive Agreement Unconstitutionally
     Abridges the Commonwealth's Police Power

     We now address Meeks' final argument assailing the

constitutionality of the Project: that the Project has abridged

the Commonwealth's police power.

     The Constitution of Virginia declares that the "police

power of the Commonwealth . . . shall never be abridged."    Va.

Const. art. IX, § 6.   The "police power," has "no exact

definition."   Blue Cross of Va. v. Commonwealth, 221 Va. 349,

358, 269 S.E.2d 827, 833 (1980).     However, the police power is

best described as the Commonwealth's inherent power, as a

sovereign, to enact laws "to promote the health, peace, morals,

education[,] and good order of the people, and to legislate so

as to increase the industries of the State, develop its

resources, and add to its wealth and prosperity."     Mumpower v.

Housing Auth. of Bristol, 176 Va. 426, 440, 11 S.E.2d 732, 737

(1940) (emphasis and internal quotation marks omitted).    The

Commonwealth's police power is abridged when the government can

                                46
no longer use its discretion in exercising this governmental

power.   See, e.g., Nusbaum v. Norfolk, 151 Va. 801, 807-08, 145

S.E. 257, 259 (1928) (holding that if an ordinance, embodying

the discretionary exercise of governmental power, could not be

repealed, it would abridge the Commonwealth's police power).

     Meeks asserts that certain terms in the Comprehensive

Agreement have the effect of abridging the Commonwealth's

police power.   These terms include: that the Project shall

continue for 58 years; that ERC can assert claims for damages

if certain specified events occur, including the construction

or expansion of a facility that would have an impact on the

Project and the imposition of certain state and local taxes;

that VDOT must "stand behind" the $422,000,000 federal TIFIA

loan to ERC; and that ERC can impose and collect the Project's

tolls in accordance with the toll rate formula.   In short,

Meeks contends that these terms prevent the Commonwealth from

responding to changing circumstances throughout the duration of

the Comprehensive Agreement.

     We start with the understanding that the grant of

authority to public entities in Code § 56-566 to enter into a

comprehensive agreement is necessarily limited by the

prohibition against any abridgment of the police power of the

Commonwealth, as set forth in Article IX, § 6 of the

Constitution of Virginia.   See Copeland v. Todd, 282 Va. 183,

                                47
193, 715 S.E.2d 11, 16 (2011).    Thus, Code § 56-566 cannot be

construed to empower public entities to abridge the

Commonwealth's police power.     Compare Victoria v. Victoria Ice,

Light & Power Co., 134 Va. 134, 144-46, 155, 114 S.E. 92, 95-

96, 98 (1922) (holding that a statutory grant of power to

municipalities to enter into contracts to fix the rates of

public service corporations was necessarily limited by the

constitutional prohibition of abridging the Commonwealth's

police powers).   However, that limitation on Code § 56-566 does

not limit VDOT's basic ability to enter into contracts with

private entities.   Indeed, it is a longstanding rule that the

Commonwealth and certain of its agencies, boards, and

commissions, that is the "arms" of the Commonwealth, can enter

contracts with private entities. 8    See South Hampton Apartments,

Inc. v. Elizabeth City Cnty., 185 Va. 67, 79, 37 S.E.2d 841,

     8
       An "arm" of the Commonwealth is a description that has
been used in referring to certain of its agencies and
commissions. See Jean Moreau & Assocs. v. Health Ctr. Comm'n,
283 Va. 128, 141, 720 S.E.2d 105, 112 (2012) (explaining that
"whether an entity is an arm or agency of the State . . .
depends on the nature of the entity"); County of York v.
Peninsula Airport Comm'n, 235 Va. 477, 481 n.1, 369 S.E.2d 665,
667 n.1 (1988) (observing that an entity that is "not an arm of
the Commonwealth, still may be a municipal corporation (and,
thus, a political subdivision)"); Prendergrast v. Northern Va.
Reg. Park Auth., 227 Va. 190, 194, 313 S.E.2d 399, 401 (1984)
(explaining that "the attributes of the particular entity . . .
must be examined to determine whether it is an 'arm' of the
Commonwealth").

                                 48
847 (1946) (counties); Tait v. Central Lunatic Asylum, 84 Va.

271, 277, 4 S.E. 697, 700 (1888) (the Commonwealth).

     So the mere fact that VDOT agrees to abide by the terms of

the Comprehensive Agreement does not abridge the Commonwealth's

police power.   Moreover, these particular terms do not "bind

[VDOT or the Commonwealth] by contract not to exercise [its

police powers] from time to time as the public good may

require."    Roanoke Gas Co. v. City of Roanoke, 88 Va. 810, 830,

14 S.E. 665, 672 (1892).   The Comprehensive Agreement must be

read as a whole as the embodiment of VDOT's determination of

how to exercise the Commonwealth's police powers.   This

determination includes when not to exercise those police

powers, as outlined by certain terms of the Comprehensive

Agreement.   VDOT, by merely entering into the Comprehensive

Agreement, has not abridged the Commonwealth's police power.

Compare Concerned Residents of Gloucester Cnty. v. Board of

Supervisors, 248 Va. 488, 499-500, 449 S.E.2d 787, 793-94

(1994) (holding that Gloucester County could permissibly enter

into a 20-year lease, which had the potential to impact the

"future prerogatives" of the county, because the General

Assembly explicitly authorized Gloucester County to do so

without prescribing the precise terms of such a contract).

     Meeks' argument evolves to challenge that it is not the

substantive obligations of the Comprehensive Agreement that

                                49
abridge the Commonwealth's police power, but the mere threat of

the resulting breach of contract damages.   In a related

context, we held that neither monetary costs of contractual

performance, nor monetary liability from breaching a contract,

constituted a "bartering away of [a county's] legislative

powers."   Id. at 494-95, 500, 449 S.E.2d at 791, 794.

Similarly, the fact that the Comprehensive Agreement requires

VDOT to pay costs or holds VDOT liable for monetary damages in

light of a breach does not abridge the Commonwealth's police

power. 9

     The Comprehensive Agreement contains an additional term

which further underscores how any monetary obligation arising

from the Comprehensive Agreement does not abridge the

Commonwealth's police power.   The Comprehensive Agreement

provides that the payment of any "damages, losses[,] or any

other amounts due and owing by [VDOT]" shall be "subject to

appropriation by the General Assembly."   The specter of

monetary liability is one conditioned on the General Assembly's

consent.   The General Assembly can therefore decide not to

     9
       Meeks argues that the Comprehensive Agreement contains
terms that amount to an impermissible penalty. See Boots, Inc.
v. Singh, 274 Va. 513, 517, 649 S.E.2d 695, 697 (2007). We
will not address this point. Neither a breach nor a particular
monetary obligation has been alleged for us to evaluate. At
any rate, penalties are unenforceable. See id.

                                50
appropriate the required funds if such a monetary obligation

were ever to actually abridge the Commonwealth's police power. 10

     We therefore hold that the Commonwealth's police power has

not been abridged by VDOT's entering into the Comprehensive

Agreement with ERC, by the substantive terms of the

Comprehensive Agreement, or by the monetary obligations arising

from performance or breach of the Comprehensive Agreement.

                           III. Conclusion

     For the aforementioned reasons, we hold that the Project

tolls are user fees and not taxes.   Therefore, the General

Assembly did not delegate its power of taxation to agencies such

as VDOT in violation of Article IV, § 1 of the Constitution of

Virginia.   We also hold that General Assembly properly delegated

to VDOT the legislative power to impose and set the rates of

user fees in the form of tolls, and that this legislative power

was not impermissibly delegated to ERC.   Finally, we hold that

the Comprehensive Agreement does not abridge the Commonwealth's

police power.   We will not reach VDOT's and ERC's argument that

the circuit court erred in refusing to grant a stay because the

     10
       We decline to consider the pure speculation that the
General Assembly would pay a monetary obligation arising from
the Comprehensive Agreement at the expense of abridging the
Commonwealth's police power. Also, the fact that the General
Assembly must weigh the practical consequences of a decision
not to appropriate funds, such as any impact on the
Commonwealth's credit rating, does not counsel us to entertain
the supposition that the General Assembly will abridge the
Commonwealth's police power.

                                51
publication of this opinion renders the issue moot.    We will

therefore reverse the judgment of the circuit court and enter

final judgment in favor of VDOT and ERC.

                                       Reversed and final judgment.

JUSTICE McCLANAHAN, concurring.

     I write separately for two reasons.    First, while I concur with

the Court’s disposition in Part B, I would apply this Court's

"determinative" test, not Massachusetts law.    Second, I do not join

Parts II.D.1.b., II.D.1.c., and II.D.2.b. because they offend the

Rules of this Court by reviewing an issue that was not decided by

the circuit court and that is outside the scope of any party's

assignments of error.

     I agree with the majority's conclusion in Part II.B. that

the toll is a user fee, but I believe the conclusion derives

solely from the Court's existing precedent distinguishing taxes

and user fees.   Mountain View Ltd. P'ship v. City of Clifton

Forge, 256 Va. 304, 312, 504 S.E.2d 371, 376 (1998); Tidewater

Ass'n of Homebuilders, Inc. v. City of Virginia Beach, 241 Va.

114, 121, 400 S.E.2d 523, 527 (1991); McMahon v. City of

Virginia Beach, 221 Va. 102, 107-08, 267 S.E.2d 130, 134

(1980); see also Eagle Harbor, L.L.C. v. Isle of Wight Cty.,

271 Va. 603, 612-15, 628 S.E.2d 298, 303-04 (2006).    An

exaction is a tax if it was adopted "solely as a revenue

measure," and an exaction was not adopted "solely as a revenue

                                  52
measure" if "'there [existed] a reasonable correlation between

the benefit conferred and the cost exacted.'"   Eagle Harbor,

271 Va. at 613, 615, 628 S.E.2d at 303-04 (quoting McMahon, 221

Va. at 107–08, 267 S.E.2d at 133-34, and Mountain View, 256 Va.

at 312, 504 S.E.2d at 376).   As the Court has made clear,

"[t]he reasonable correlation test . . . . is determinative of

whether a fee enacted . . . is a permissible exercise of [a

governing body's] police power as opposed to an impermissible

revenue-producing device in the form of a [tax]."   Id. at 615,

628 S.E.2d at 304 (emphasis added).   Because our precedent

provides a test "determinative" of the issue in Part II.B., I

do not agree with the majority's reliance on Massachusetts law

to adjudicate a case arising under the Constitution of

Virginia.   Instead, because the evidence shows a reasonable

correlation between the tolls imposed on motorists at each

transportation facility and the resulting benefit of improved

traffic conditions realized by motorists at each transportation

facility, I would hold that under Virginia law the toll is not

a tax.

     In Part II.D., the majority creates a dichotomy between

delegation of legislative power to a private entity and mere

"empowerment" of such an entity, in support of the view that

the General Assembly did not delegate toll-setting authority to

ERC either directly (Part II.D.1.b.) or indirectly through VDOT

                                53
(Part II.D.1.c.).    The circuit court, however, held only that

there was an unconstitutional delegation of power to VDOT, not

to ERC:

     [T]he General Assembly has given unfettered power to
     the Virginia Department of Transportation to set toll
     rates without any real or meaningful parameters in
     violation of Article IV, § 1 of the Constitution of
     Virginia.

Under Rule 5:17(c)(1), this Court does not review decisions the

lower court did not render.    See, e.g., Paugh v. Henrico Area

Mental Health & Developmental Servs., 286 Va. 85, 87 n.1, 743

S.E.2d 277, 278 n.1 (2013) (refusing to entertain appeal of a

decision the circuit court did not make).

     Given that the circuit court's holding was specific to

VDOT, the parties naturally assigned error to the holding that

the General Assembly unconstitutionally delegated authority to

VDOT, not ERC. 1   Notwithstanding the absence of an assignment of

     1
       For example, ERC's relevant assignment of error clearly
concerned delegation of power only to VDOT:

     The trial court erred in holding that the General
     Assembly unconstitutionally delegated toll-setting
     authority to VDOT.

And even the appellees' assignment of cross-error, in which
they proposed an alternative basis for the circuit court to
have granted summary judgment in their favor, did not contend
that the General Assembly delegated power to ERC:

     The Circuit Court erred   by not granting summary
     judgment to Appellees .   . . on the alternative ground
     that exacting a rate of   return on private investment
     . . . through tolls . .   . is an exclusively

                                 54
error implicating delegation of authority to ERC, the majority

discusses the issue at length.   See Rule 5:17(c)(1)(i) ("Only

assignments of error assigned in the petition for appeal will

be noticed by this Court.")

     Because the majority's discussion of whether the General

Assembly delegated toll-setting authority to ERC violates the

Rules of Court by reviewing an issue that the circuit court did

not decide and that is outside the scope of any party's

assignment of error, I do not join Parts II.D.1.b., II.D.1.c.,

and II.D.2.b. 2

     legislative function that was unconstitutionally
     exercised by, or unconstitutionally delegated to,
     VDOT.
     2
       Moreover, even if it were not a violation of our Rules of
Court to engage in the discussion set out in Part II.D. of the
majority opinion, I note that the delegation and "empowerment"
dichotomy finds no legal basis in this Court's precedent,
misinterprets as support the United States Supreme Court's
decision in Sunshine Anthracite Coal Co. v. Adkins, 310 U.S.
381 (1940), and unnecessarily complicates the Court's
jurisprudence by stamping a new legal label of "empowerment" on
any private entity's mere proposal of contract terms to the
Commonwealth, which the Commonwealth is free to accept or
reject. I would adhere to the traditional, straightforward
dichotomy: Legislative power has either been delegated or it
has not.

                                 55