Court Opinion

ID: 9575927
Source: CourtListenerOpinion
Date Created: 2023-08-21 21:18:41.068016+00
Date Added: 2024-06-11T12:50:31.242207
License: Public Domain

*214CLARK, Judge,
dissenting:
Municipal action fixing rates which a municipality will charge for services it renders is a proprietary, as opposed to a governmental, function of local government. Aviation, Inc. v. Airport Authority, 288 N.C. 98, 215 S.E. 2d 552 (1975). I agree with the majority that, in determining the rates it will charge for performance of a proprietary function, the governing board of a municipality “acts as does the board of directors of a private corporation owning and operating a like facility, subject only to limitations imposed upon it by statute or by contractual obligations assumed by it.” Id. at 103, 215 S.E. 2d at 555. I disagree, however, that, the statute allowing imposition of water and sewer rates, G.S. 160A-314(a), is an unfettered grant of authority allowing a municipality to charge for services not yet furnished by the municipality.
As I construe G.S. 160A-314(a), the authority of a municipality to fix rates for water and sewer services is limited to charges for services which are actually being furnished. In this interpretation, I have attempted to construe strictly and precisely the legislative wording of the statute. While a municipality has discretion to establish rates for services furnished, it does not have the authority to charge for services “to be furnished.” Contrast with G.S. 160A-314(a) the parallel grant of authority to water and sewer authorities to fix rates, G.S. 162A-9, which reads, in pertinent part:
“Each authority shall fix, and may revise from time to time, reasonable rates, fees and other charges for the use of and for the services furnished or to he furnished by any water system or sewer system or parts thereof owned or operated by such authority.” [Emphasis added.]
To protect against possible abuses of this broad grant of power, the legislature directed water and sewer authorities to hold all moneys received pursuant to their statutory authority as trust funds to be applied solely as provided by statute. G.S. 162A-11. There is no comparable statute in the article granting municipalities the power to set water and sewer rates. Additionally, plaintiffs attempt to analogize its ability to charge in advance for services to be rendered by facilities under construction, to the ability of public utility companies to charge in advance for serv*215ices to be rendered by facilities under construction, further emphasizes its lack of statutory authority to charge for future services. Pursuant to the provisions of G.S. 62-133(b)(l), the North Carolina Utilities Commission, in establishing rates for public utilities, has the explicit authority to consider “reasonable and prudent expenditures for construction work in progress . . . .” [Emphasis added.]
I believe that these two statutes accentuate the statutory restrictions placed upon municipalities in setting water and sewer rates. Had the General Assembly intended that municipalities be able to establish rates for services to be furnished, it could very easily have expressed this intention. The General Assembly having clearly expressed its will, the courts of this State are without power to interpolate or superimpose conditions which are not called for in the statute. See, e.g., Board of Architecture v. Lee, 264 N.C. 602, 142 S.E. 2d 643 (1965).
In concluding that municipalities have no power to establish rates to pay for construction of new, unused facilities, I am not unmindful of the dilemma this ruling poses for local governments. I believe, however, that the legislative scheme grants towns and cities the ability to finance new construction of water and sewage disposal systems through the levying of special assessments. See G.S. 160A-216(3), (4). It is noteworthy that plaintiff argued in the present case as though the increase in rates were an assessment. The increase, however, was not an assessment. The nature of the charge was not that of an assessment. “ ‘It is the majority rule that sewer service charges are neither taxes nor assessments, but are tolls or rents for benefits received by the user of the sewer system ....”’ Covington v. Rockingham, 266 N.C. 507, 511-12, 146 S.E. 2d 420, 423 (1966), quoting Rhyne, MUNICIPAL LAW, Sewers and Drains, § 20-5, p. 462, et seq. Furthermore, the procedure for establishing an assessment was not followed by plaintiff.
Throughout the litigation of the case sub judice, the position of the plaintiff was consistent: the increase in overall water and sewer charges was caused by the need to service the debt related to, and otherwise to pay for, the waste water treatment facility which was not at the time in use. Under North Carolina law, this increase was, therefore, improper.
I would affirm the judgment of the trial court.