Court Opinion

ID: 9659674
Source: CourtListenerOpinion
Date Created: 2023-08-23 21:52:12.216528+00
Date Added: 2024-06-11T18:14:10.695159
License: Public Domain

T. E. Brennan, J.

(dissenting). The gist of the 
*382
majority opinion is that the stadium bonds are invalid because they are not ’’true” revenue bonds.

They are not "true” revenue bonds, say the majority, because they are, in reality, "tax bonds”, backed by the full faith and credit of the County of Wayne.
They are "tax bonds”, the reasoning goes, because the county has agreed to lease the stadium; has pledged its full faith and credit for the payment of the rent; and the amount of the rent is equal to the obligation on the bonds.
This, of course, was precisely the argument of the plaintiff in Walinske v Detroit-Wayne Joint Building Authority, 325 Mich 562, 574-575, (1949):
"Plaintiff contends that a vote of the electorate is required by the Constitution, the State statutes and the charter of the city of Detroit to authorize the proposed construction and issuance of bonds. He claims that the city and county by entering into a lease binding them for a long term of years to pay a rental sufficiently large to pay the operational cost of the contemplated building, the interest on the revenue bonds as it becomes due, and also the principal of the bonds as it becomes due over the period of the lease, and the fact that the lease and the bonds are to be for the same term and when the bonds are retired the authority must convey the building to the city and the county, is in effect a contract to pay the cost of the building. He further claims that the proposed bonds to be issued by the authority are in fact full faith and credit bonds of the city and county and subject to their bond debt limitations. He admits that the bonds are to be issued by the authority, and that the city and county do not pledge their credit to pay the interest and .principal directly, but that they do so indirectly by agreeing to pay rent to the authority sufficient to pay such interest and principal over a long period of years. He further claims that this is an illegal method of circumventing the law and constitutional provisions, as the city and *383county are attempting to do indirectly what they could not do directly.”
If the county’s pledge of full faith and credit to pay the rent converts these bonds into "tax bonds”, and if that is the controlling fact, then it is difficult to see how any public building can be financed under the building authority act (1948 PA 31) without the same objection.
But, my Brethren reply, there is a difference between a courthouse and a stadium. Of course there is a difference.
But if building authority bonds for a courthouse rented to the county are valid and building authority bonds for a stadium rented to the county are invalid, then the difference between a courthouse and a stadium must be the salient and distinguishing fact, which causes the difference in the bonds.
If the county’s agreement to pay rent converts these stadium bonds into tax bonds, and the county’s agreement to pay rent does not convert courthouse or jail bonds into tax bonds, then it is obvious that the controlling element is not the fact of the payment of rent, but the purpose or reason for which the rent is paid.
Here of course, the majority opinion runs headlong into the plain language of the statute. Stadiums are listed along with other public buildings. Stadiums are specifically declared to be proper public purposes.
Indeed, the conclusion is inescapable that the Legislature in 1970, by PA 47, amended PA 31 of 1948, with the precise transaction before us uppermost in their minds.
"Sec. 8. The authority and any incorporating unit or units shall have power to enter into a contract or *384contracts whereby the authority will acquire property contemplated by the terms of this act and lease the same to the incorporating unit or units for a period not to exceed 50 years. The consideration specified in such contract for such use shall be subject to increase by the authority if necessary in order to provide funds to meet its obligations. Any rental obligation or consideration applicable to the incorporating unit or units under such contract, shall not be considered as indebtedness of the incorporating unit or units within the meaning of any statutory or charter debt limitation of such incorporating unit or units. With the consent of the authority as contained in the contract or otherwise securedany incorporating unit or units to which the property is leased, may sublease the property or any part thereof to any 1 or more persons, firms or corporations or may contract for the use of the property or any part thereof by any 1 or more persons, £rms or corporations, where the sublease or contract beneñts and serves a legitimate public purpose of the sublessor. Any sublease or contract may extend for a period not to exceed 50 years and is not a franchise or grant within the meaning of any statutory or charter provision. The acquisition of any stadium with appurtenant properties and facilities by any authority and the contracting for the lease thereof by any incorporating unit or units, for the purpose of providing facilities for sports, recreational and other activities and events, with or without admission charges, and furnishing facilities for use or enjoyment by the public and to induce sports and entertainment organizations, whether amateur or professional, to utilize the facilities for games, contests and other performances and attractions and thus to increase business activity and employment, constitutes a benefit to and a legitimate public purpose of the authority and the incorporating unit or units. Where any stadium with appurtenant properties and facilities is acquired by an authority and leased to any incorporating unit or units, the subleasing thereof to, or the contracting for the use thereof by, any sports, entertainment or similar organization or any owner of a franchise in any professional sports or athletic league or association, in consideration of the agreement of the organization or owner and, if *385necessary, the league or association to hold, conduct or produce games, contests and other performances and attractions in such stadium, with or without admission charges, constitutes a benefit to and a legitimate public purpose of such incorporating unit or units. ” (Emphasis added.) MCLA 123.958; MSA 5.301(8).
Oddly enough, the majority have not found the 1970 amendment a violation of the constitutional prohibition against the loan of state credit. 1963 Const, art 9, § 18.
Quite the contrary, the majority has concluded that the acquisition and operation of a stadium by the county is a proper public purpose.
If the county’s rent obligation is not the crucial fact, and if the construction of a stadium is not per se the crucial fact, what is?
Put another way, if some stadium bonds are valid and some stadium bonds are invalid, where is the line to be drawn?
Now my Colleagues reply, "there are stadiums and there are stadiums.” Of course there is a difference. All stadiums are not alike.
But are they to be distinguished in point of law or on the basis of their size? Their cost? Their location? The shape of the playing field or the sports intended to be played there?
Clearly such considerations are irrelevant.
The majority holds that stadium bonds issued solely under the Revenue Bond Act, without the incorporation of a building authority, or the intervention of a leasehold interest in the incorporating unit, would be valid. In such a case, the private user would pay rent sufficient to meet the entire bonded obligation.
Such bonds, it is suggested, would be "true” revenue bonds.
But the question remains whether any kind of a *386stadium can be built under the building authority act (Act 31).
The question remains whether in the absence of any sufficient anticipated profit from the operation of the stadium, the county itself can guarantee the revenue which will underlie the issuance of the bonds.
In short, can the county itself get into the stadium business?
Could the county rent an existing stadium for the purpose of providing a place for its citizens to compete in various athletic contests and to attend such games, or to present and attend various pageants, celebrations and conventions, or generally to accommodate the many public functions of general interest and concern to the citizenry?
In my own view, the answer is obvious. Stadiums and Colosseums are among the most ancient of municipal structures.
Surely there are many publicly owned stadiums and athletic arenas already built and operating in Michigan. State owned colleges and universities have state-owned stadiums. Public schools have football fields and baseball fields and gymnasiums. The State Fair has both indoor and outdoor arenas. County fairs have race tracks and grandstands. Public parks have athletic fields of every description and benches, dugouts, seats, chairs, press boxes, locker rooms, turnstyles, scoreboards, lights and every conceivable accoutrement. Prisons have stadiums.
If all the publicly owned grandstands in Michigan were filled to capacity at the same time, there would be hardly anyone standing up from Monroe to Manistique.
It may be that there are more pressing demands *387upon the county’s purse than renting a stadium in downtown Detroit.
But whatever the policy considerations, this is a very late date indeed for this Court to pronounce that the county may not legally and constitutionally undertake to rent one.
The feeling abides that the taxpayers of Wayne County are being used; that their rental payments will go to acquiring a magnificent riverfront stadium which will then be turned over, for an inadequate consideration to the Detroit Baseball Club, Division of John E. Fetzer, Inc.; that this aspect of the transaction is so unconscionable as to prompt the court below, and this Court, to hold the entire bond issue invalid, even though the legal theory of the bond issue is technically unassailable.
Some sections of the proposed sublease to the Detroit Baseball Club are especially disconcerting. It contemplates that 40,000 square feet of office space will be provided to the sublessee, within the stadium facility. It grants a monopoly to the Detroit Baseball Club in the area of professional and "semi-professional” baseball. It permits the Baseball Club to use the stadium for practice sessions whenever it is not otherwise being used, and prohibits the county or the Authority from using the stadium at all except upon seven days notice to the sublessee.
Such arrangements are hardly consistent with the non-discriminatory conduct of a publicly owned and operated facility.
The general corporate offices of the baseball team which plays in the stadium have no more call to be housed in the stadium than the general corporate offices of the meat packing firm which supplies the hot dogs or the broadcasting company which televises the games.
*388Professional baseball is a lawful occupation, and even at the major league level is not so affected with the public interest as to be classified as a public utility. The county has no more right to issue a baseball franchise in a domed stadium than it has to grant a monopoly to any user of a public facility. Neither can a public facility be "reserved” for a single user without the payment of the same consideration as any other user would be required to pay for the possession of the premises during a comparable period of time.
But these and other considerations which go to the validity of the sublease, are not presently before us.
They should be considered in a proper proceeding to which the Detroit Baseball Club has been made a party.
In my view, the sublease neither adds to nor detracts from the legal posture of the proposed bond issue.
I would reverse and remand.