The opinion
On Rehearing
HARWOOD, Justice.
In briefs in support of the application for rehearing counsel for appellee, and supporting amicus curiae counsel insist that our opinion in this case is erroneous, in that taxation of counties, municipalities, or arms, branches, or instrumentalities of the state can be imposed only in specific language, and not in general terms. City of Huntsville v. Madison County, 166 Ala. 389 , 52 So. 326 ; State v. City of Montgomery, 228 Ala. 93 , 151 So. 856 ; City of Birmingham v. State ex rel. Carmichael, 233 Ala. 138 , 170 So. 64 ; Jefferson County v. State ex rel. Carmichael, 233 Ala. 148 , 170 So. 70 ; Opinion of the Justices, 235 Ala. 485 , 179 So. 535 ; Jefferson County v. City of Birmingham, 235 Ala. 199 , 178 So. 226 ; State Tax Commission v. County Board of Education of Jefferson County, 235 Ala. 388 , 179 So. 197 ; County Board of Education of Jefferson County v. State ex rel. Carmichael, 237 Ala. 434 , 187 So. 414 ; City of Birmingham v. Birmingham Business College, 256 Ala. 551 , 56 So.2d 111 ; City of Anniston v. State, 265 Ala. 303 , 91 So.2d 211 .
Counsel for amicus curiae in their brief state:
“Thus we have no doubt that if the legislature clearly and explicitly so authorizes, municipalities may impose license taxes on public agencies.”
*359 Counsel for appellee have laid much stress upon the language contained in the opening sentence of Section 402(64) of Title 37, Code of Alabama 1940. The caption and the language of this section is identical with that of the original Act (Act No. 762, p. 1319, Acts of Alabama 1951). This code section and the original Act reads:
“Freedom of district from public service commission and other state supervision and control.- — This article is intended to aid the state in the execution of its duties by providing appropriate and independent instrumentalities of the state with full and adequate powers to fulfill their functions. Except as in this article expressly otherwise provided, no proceeding, notice or approval shall be required for the incorporation of any gas district or the amendment of its articles of incorporation, the acquisition of any property or system or systems or the making of any loans or the issuance of any bonds or instruments in evidence thereof or as security therefor, any other law to the contrary notwithstanding. Every district incorporated under this article and every gas system of such district and the rates and charges thereof shall be exempt from all jurisdiction of, and all regulation and supervision by, the public service commission.”
The first sentence is in the nature of a preamble to the code section which purports only to free gas districts organized under Article 9 of Title 37 (Secs. 402(47) through Sec. 402(66a) from supervision by the Public Service Commission.
This first sentence, supra, is self contradictory. There are no “duties” upon the state to supply its citizens with gas. The phrase “by providing appropriate and independent instrumentalities of the state with full and adequate powers to fulfill their functions” is paradoxical, in that an “independent instrumentality of the state” is a free unit within itself, and if independent, is not an agency of the state.
A reading of the entire Article 9, supra, demonstrates conclusively, despite the opening sentence of Sec. 402(64), supra, that the legislature has set up a plan by which it authorizes municipalities to incorporate gas districts. When such districts are incorporated, the powers of the district are spelled out. The board of directors consists of at least one member representing each municipality, to be elected by the governing body of each municipality. This board of directors is vested' with full powers to do all things necessary and convenient to the operation of the gas district. Thus a gas district organized pursuant to Article 9, supra, is a public corporation organized pursuant to authority granted by the legislature.
The net profits from the operation of such gas district, unless otherwise provided in the certificate of incorporation, are to be divided among the member municipalities in proportion to the amount of gas sold within such municipality. The state receives none of the profits.' ' '
Under the above provisions, we seriously doubt that a gas district could properly be classified as a state agency, though -it is a public agency organized pursuant to applicable statutory provisions.
Where a municipality engages in the business of furnishing electricity, lights, water, or gas to the public, it is not then discharging or exercising governmental functions or powers, but is exercising proprietary or business powers, and as to such business it is governed by the same rules of law which are applicable to ordinary business corporations. City of Decatur v. Parham, 268 Ala. 585 , 109 So.2d 692 . No different standard can rationally be applied to a gas district organized by a number of municipalities.
The state may tax cities as other persons, provided the intention to tax is clear, and no constitutional inhibition exists. This power of the state to tax has been delegated to the Town of Hackleburg *360 as pointed out in our opinion. The Town of Hackleburg has by clear language imposed the privilege license tax in question.
Opinion extended and application for rehearing overruled.
LIVINGSTON, C. J., and SIMPSON and MERRILL, JJ., concur.