Opposition Brief — Dickinson v. Porter
Supreme Court brief1949
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INDEX.
Sussect INDEX.
The appeal is in good faith and not for the purpose
WE GOMAY .nccccccccccescvcccccvccvevecccesecens
Federal questions involved are substantial in charac-
SPPPTPTTTEPETEOTIE LLP e ee
lowa State Statutes, the validity of which are involved
Nature of case and rulings below .............6.455
Points relied upon for reversal ..........6 6660 e eee
Federal questions involved herein have not been
decided by United States Supreme Court ........
Federal questions involved herein require analysis
and exposition by United States Supreme Court . .
Proposition A, containing first point relied upon for
reversal and grounds upon which it is contended
that the question involved is substantial in charac-
| SP PeTETETETETETLIRIE TE
Proposition B, containing second point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
Gen GROTOCUOE occ cc ence er cerccccccessccevvcccese
Proposition C, containing third point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
We GROPRONER occcccccnecccvecoscvsesevceccseess
Proposition D, containing fourth point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
We GROPRCIOT oc ccc cs ccccccccccccvevecsecevees
Proposition E, containing fifth point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
fe GROPACIER 2c cccccceccvccccccsecnsseccsccess
Proposition F, containing sixth point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
fee GRRTOOUET . occ cc ccceccccccccecevececcevevess
Ilene
Page
NIorbs t& tS
10
11
14
21
SVE Pane a
a
Page
Proposition G, containing seventh point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
Be NE Seu cnndnddocikscedVewénwtdbetnowess 45
Proposition H, containing eighth point relied upon
for reversal and grounds upon which it is con-
tended that the question involved is substantial
SY Uukdcgpndudndwes bub deese dubdeateeuns 55
SE WeSredede avin pcnCecksd devs cevdscunusasi 63
ii INDEX
TaBLe or AuTHorities Crrep.
CASES: Page
Adams v. Milwaukee, 228 U. S. 572, 33 S. Ct. 610, 57
Dp ME UE. Hansankaredeces Gusdvadcuctbenscences 16
Airway Electric Appliance Corp. v. Day, 266 U. S. 71,
Pe i a es SS hie bo ve dusckcadececess. 34, 38
American Sugar Refining Co. v. Louisiana, 179 U. S.
GB, 23S. Ct. 4B, G5 L, Ba. 01GB . wc cece cc ccccccces 11
Appeal of York & Foster, (Pa.) 43 A. (2d) 557 ...... 15
Asbury Hospital v. Cass Co., 326 U. S. 207, 66 S. Ct.
er es SP OF bcakenl conekedneadacnnséeccecwes 15, 24
Barbier v. Connolly, 113 U. S. 27, 55 S. Ct. 357, 28 L.
Bayside Fish Flour Co. v. Gentry, 297 U. S. 422, 56
S. Ct. 513, 80 L. Ed. 772
Bell v. Town of Pulaski (Tenn.) 1848S. W. (2d) 384 ..
Blaine County Inv. Co. v. Gallet (Idaho) 204 Pac.
1066
Brinkerhoff-Farris Trust & Savings Co. v. Hill, 281
U.S. 673, 50S. Ct. 451, 74 L. Ed. 1107
Cary v. City of Pekin, 88 Il. 154
Chicago, M. & St. P. Ry. Co. v. Phillips, 111 lowa 377,
82 N. W. 787
Connolly v. Union Sewer Pipe Co., 184 U. S. 540, 22
S Ct, 458, 4B L. Bad. GID... cc cccccccesss 11, 14, 26, 28
Copeland v. City of St. Joseph (Mo.) 29S. W. 281 .... 15
Corporation of Sevierville v. King (Tenn.) 184 S. W.
BLEED THROUGH=—POOR COPY
INDEX iii
Page
Cotting v. K. C. Stockyard Co., 183 U. S. 79, 22S. Ct.
OR GB Be AR. Be ao cnccnesndccctusegeccevcescesses 27, 28
Dickinson v. Porter (first opinion) (lowa) 31 N. W.
CR GD. vcccdcndecceveraductvadesescesasecns 6
Dickinson v. Porter (second opinion) (lowa) 35 N. W.
CD GD a clevawevss cusccnnvsthechoccsenscotees: 6
Dodge v. Mission Township, 107 Fed. 827 ............ 4
Engel v. O'Malley, 219 U.S. 128, 31S. Ct. 190, 55 L. Ed.
TED cn cincdcnnecedccvccsevedsvesecccctsevecersses 22, 23
Essex Counly Park Commission v, Ellis, 165 U.S. 150,
CE GE Gh, Tie BF Bc TR GD edccvcccccesscacsvcecs 15
Fisk v. Kansas, 274 U. S. 380, 47 S. Ct. 655, 71 L. Ed.
GOED cn cbc ccc vecesocdccccccusecesseccccseceens 11
Funke v. Lancaster Co., 110 Neb. 635, 194 N. W. 807 .. 34, 35
Gast Realty & Investment Co. v. Schneider Granite
Co., 240 U. S. 55, 36S. Ct. 254, 60 L. Ed. 523 ...... 34, 37
Goodlove v. Logan, 217 lowa 98, 251 N. W. 39......... 45, 50
Hanson v. Vernon, 27 lowa 32 ... 6.666666 eee e ee eee 41
Hayes v. Missouri, 120 U.S. 68, 7 S. Ct. 350, 30 L. Ed.
BD cncbsrbccsedecssdesccedteceocensegsvsensses 27
Houck v. Little River Drainage Dist., 239 U. S. 254,
SB GB. Ch. GR, GD 1 Te, Fe oc cccccccccescccscesses 34, 37
In re Opinion of the Judges (S. D. 1932) 240 N. W.
GD ccncacencccccsssacsapeccbecsisscedes gessove 41
In re Opinion of Justices, 208 Mass. 616, 94 N. E.
GOD icdecccccccdéseccsdactecescsvcscesouses 27, 31, 32
In re Opinion of Justices, 195 Mass. 607, 84 N. E. 499 . . 34, 39
Kansas Cily St. R. Co. v. Road Imp. Dist. No. 6, 256
U. S. 658, 41 S. Ct. 604, 65 L. Ed. 1151 ............ 34, 38
Keefner v. Porter, 228 lowa 844, 293 N. W. 501.11, 12, 13,
Kelly v. Pittsburgh, 104 U. S. 78, 26 L. Ed. %S8 ... .16, 20, 22,
Laughlin v. City of Portland, 1.. Maine 486, 90 Atl.
SD a. tuhan cok Mesa Car mndahes kia és asnawee 41
Lawrence v. State Tar Commission, 286 U. S. 276, 52
ee & | 5 | RR ere 11
Louisville & Nashville R. R. Co. v. Melton, 218 U. S.
a Ee as a es le UE bccn scans deseueues 11
a
iv INDEX
Page
Louisville Gas & Elec. Co. v. Coleman, 277 U. S. 32,
BD. CR, GE, OB Een TER, TID nc cc cccecsccccvecsenes 34
Love v. City of Des Moines, 210 lowa 90, 230 N
GUE VabeNaeeenesebbesacssvees shee veuccecseeedes 42
Lowell v. Boston, 111 Mass. 454 2... 0.66.0 0666 eae 42
Martin v, District of Columbia, 205 U.S. 135, 27 S. Ct.
Se es OD Serbs dueeducawedsnesenceeceson 34, 37
Metropolitan Casualty Insurance Co. v. Brownell,
294 U. S. 580, 55S. Ct. 538, 79 L. Ed. 1070 | 2.2... 15
Monaghan v. Lewis (Del.) 59 A. DIB... ee ee 15
Morton Salt Co. v. City of South Hutchinson, 159
PE EE hid VAD GAs ererbabosas vebednuencees 16
Opinion of Justices (Maine) 55 A. 827 .............. 15
Panama Refining Co. v. Ryan, 293 U.S. 388, 55S. Ct.
ee RD aed bcchancabs Sane chenesovesene 56
Peabody v. Russell, 302 Ill. 111, 131 N. E. 150, 20
SS RE eer ere eT TTI Tere 45, 56, 57
People v. Brady, 277 Il. 124, 115 N. E. 204... 0.6... 45
People v. Klehm, 350 Ill. 419, 183 N. E. 44 2... 2... 34, 35
Power Mfg. Co. v. Saunders, 274 U. S. 489, 47 S. Ct.
ee Sa ies MU ED bo p'base 5 cncacone cecctcesaussne 15
St. John v. New York, 201 U. S. 633, 26 S. Ct. 554, 50
Pe ME 6 pean GUMN din gue cus Can enseusediceeceus 16
St. Louis & S. F. R. R. Co. v. Delk, 158 Fed. 931 ...... 42
Savings & Loan Ass'n. v. Topeka, 20 Wall. 655, 22
Res. WES 6.8 600606060 05568 beseecavetvectuasce 42
Schechter Poultry Corp. v. United States, 295 U. S.
495, 55 S. Ct. 837, 79 L. Ed. 1570 ...........008-- 56
Simmons v. Ericson (S, D.) 223 N. W. 342 ... 11, 12, 15, 17
Smith v, City of Americus (Ga.) 15 8. E. 752 ........ 15
Smithberger v. Banning, 129 Nebr. 651, 262 N. W. 492,
Ps es SE sn oekaconkeoscesedeces 44, 45, 53, 54, 56
Stanley v. Jeffries, 2A Pac. 134 ... 6... cece eee 42
State ex rel Davis v. Eggers (Nev.) 91 Pac. 819 ...... 45, 50
State ex rel Welsh v. Darling, 216 lowa 553, 246
Se We ME hoensdecudenssdbecteescsccvecsecccces 22
State v. Dawson (Wisc.) 280 N. W. 698 ............ 42
State v. Fowler, 94 Fla. 752, 114 So. 435 ............ 45, 51
State v. Williams, 43 Nev. 290, 185 P. 459 .......... 42
DLEED THROU GH=—POOR COPY
INDEX Vv
Page
Thomas v. Gay, 169 U. S. 264, 18 S. Ct. 340, 42 L. Ed.
ee ls es a dee kae ates wese seer csedeus 16
Thompson v. Consolidated Gas Utilities Corp., 300
U. 8. 55, 57 S. Ct. 364, 81 L. Ed. 510 ........6-666- 42
Truax v. Corrigan, 257 U. S. 312, 42 S. Ct. 124, 66 L. Ed
Td ccse eh eehs Vhs edi g GEUCTR EET SN seedterers 15
United States v. Dexter (lowa) 154 Fed. 890 ........ 42
William Deering & Co. v. Peterson, 75 Minn. 118,
TT WR. We. GOB ce cccvccccccccccccccevecvccvessess 42
Wilson v. School Dist. (Pa.) 195 A. 90, 113 A. L. R.
DE cu Stn ue Spas bees 6 hab WERE Neves eHeSeerseees 45
Winter v. Barrett, 352 Ill. 441, 186 N. E. 113, 89 A. L. R.
So in nb cchebeus Pecos uevesnedercensees 46, 52, 56, 57
Wright v. House, 188 Ind, 247, 121 N. E. GP scescees 16
Yick Wo. v. Hopkins, 118 U. S. 356, 6 S. Ct. 1064, 30
Be Be MD vncusancscsvcccdvevectveverens 28, 46, 49, 56
STATUTES:
Section 1 of the Fourteenth Amendment to the Con-
stitution of the United States ...........-++.555- 1
Chapter 426, Code of lowa 1946 (as amended) ...... 2,
BOM MED oc occce vecdersevecveveverecoeevess
EE cc ciscccevedcoesedevoucevseeseeens
eR GED gc acc crusedvecevoseeevererviates
CME. vccs pcebecdnt tp evecesuverevoryves
RN MED ccccccccccceccciscsesvotscereroses
EEE ccccccvccececsereteeercveecessoere
eR GD occ pcccccccetevedvcececesvecesvers
mm eww DN DY OI
TEXTBOOKS:
51 American Jurisprudence, Section 9 of ‘i: axation” 16
Vol. I, Cooley on Taxation, Fourth Edition, pp. 213-
215, Sections 179 and 182 ...........6eeeeceeees 16, 41
Vol. 61 Corpus Juris “Taxation” Section 3 .........- 16
Vol. 61, Corpus Juris “Taxation” Section 388, p. 388 . . 34, 38
Vol. 3 Words and Phrases, Permanent Edition, p. 46 42
Oey ~~
OTe cn THE C¥HICUuUeK POOR CODY
IN THE
Supreme Court of the United States
OCTOBER TERM, 1949.
ee - -
No. 174
LAURA DICKINSON,
Appellant,
vs.
C. FRED PORTER, State Comptroller, of the State of Iowa,
and J. M. GRIMES, Treasurer of State, of the State of
lowa, ALLAN T. DAYKIN, County Auditor of Dubuque
County, lowa, and LEO J. MEUSER, County Treasurer
of Dubuque County, lowa.
APPELLANT’S BRIEF OPPOSING MOTION TO
DISMISS OR AFFIRM.
Appellees’ statement as to jurisdiction and motion to
dismiss or affirm is limited exclusively to the following
grounds, to-wit: ;
1. That the appeal is taken for the purpose of delay
only.
2. That the federal questions involved are not substan-
tial in character.
FE PO ae et
—2—
I.
THE APPEAL IS TAKEN IN GOOD FAITH AND NOT
FOR THE PURPOSE OF DELAY.
A reading of the record will disclose that the appeal is
taken in good faith and not for the purpose of delay.
THE FEDERAL QUESTIONS INVOLVED HEREIN
ARE SUBSTANTIAL IN CHARACTER.
Statute of the State of Iowa, the validity of which is
involved.
The statute of the State of Iowa, the validity of which
is involved herein is Chapter 426 of the 1946 Code of Iowa
as amended, pages 1228 and 1229, the pertinent provisions
of which are as follows:
“426.1 Agricultural land credit fund. There is hereby
created as a permanent fund in the oflice of the Treasurer
of state a fund to be known as the agricultural iand credit
fund, and for the purpose of establishing and maintaining
said fund for each fiscal year beginning July 1, 1946,
there is appropriated thereto from funds in the general
fund not otherwise appropriated the sum of five million
dollars. Any balance in said fund on June 30 shall revert
to the general fund.
426.2 Definition. ‘Agricultural lands’ as used in this
chapter shall mean and include all tracts of land of ten
acres or more, and not laid off into lots of less than ten
acres or divided by streets and alleys into parcels of less
than ten acres, lying within any school corporation in this
state and in good faith used for agricultural or horticul-
tural purposes. Any land laid off or platted into lots of
less than ten acres belonging to and a part of other lands
BLEED THROUGH=—POOR COPY
_—
Pe Se
of more than ten acres and in good faith used for agricul-
tural or horticultural purposes shall be entitled to the
benefits of this chapter.
426.3 Where credit given. The agricultural land credit
fund shall be apportioned each year in the manner herein-
after provided so as to give a credit against the tax on each
tract of agricultural lands within the several school dis-
tricts of the state in which the millage for the general
school fund exceeds fifteen mills; the amount of such
credit on each tract of such lands shall be the amount the
tax levied for the general school fund exceeds the amount
of tax which would be levied on said tract of such lands
were the levy for the general school fund fifteen mills,
except in the case of a deficiency in the agricultural land
credits fund to pay said credits in full, in which case the :
credit on each eligible tract of such lands in the state shall
be proportionate and shall be applied as hereinafter pro-
vided. The agricultural land credit as provided herein
shall not be made to any taxpayer on any portion of his
property upon which a homestead credit, as provided by ;
Chapter 425, has been allowed for the year in which the
agricultural credit is claimed.
426.6 Computation by auditor. On or before August 1
the county auditor shall list by school districts all tracts of |
agricultural lands which are entitled to credit hereunder
together with the taxable value, and immediately upon |
receiving the certification of the budget from each school
district shall determine the tax rate for the general fund
of the district in the manner provided in Section 444.3, if
the tax rate is in excess of fifteen mills he shall multiply
the millage which is in excess of fifteen mills by the total
laxable value of the agricultural lands entitled to credit
hereunder in the district and on or before November 10
certify the amount thereof to the state comptroller, In
the event the county auditor denies a credit upon any
nuliion
such lands, he shall immediately mail to the owner at his
last known address notice of his decision thereon. * * *.
426.7 Warrants drawn by comptroller. After receiy-
ing from the several county auditors of the state the certi-
fications provided for in Section 4126.6, and on or before
December 10, the state comptroller shall draw warrants on
the agricultural land credits fund created by this chapter,
payable to the county treasurers of the several counties of
the state in the total amount certified by the county audi-
tors of the respective counties and mail said warrants to
the county auditors of said counties, provided that in the
event the agricultural land credits fund is insuflicient to
pay in full the total of the amounts certified to the state
comptroller on the tenth of November, he shall prorate
the fund to the several county treasurers and notify the
several county auditors of the prorata percentage at the
time of mailing the warrants to them.
426.8 Apportionment by auditor. Upon receiving the
warrant from the state comptroller the county auditor
shall determine the amount thereof to be credited to each
tract of agricultural land, and shall enter upon the tax
lists as a credit against the tax levied on each tract of
agricultural land on which there has been made an allow-
ance of credit, the amount of said credit, and shall deliver
the comptroller’s warrant to the county treasurer with the
tax lists. The county treasurer shall credit each school
district with the total amount of the tax credits credited
on lands in the district and shall show on each tax receipt
the amount of tax credit for each tract of agricultural
lands.
426.9 Pro rata disbursement. If the appropriation
herein is insufficient to pay the credits in full, then in that
event they shall be paid on a pro rata basis.”
BLEED THROUGH—POOR COPY
——
Nature of case and rulings below.
The statute in question sets aside ifve millow atalies:
for each fiscal year to be used to pay all of the general
school fund taxes in excess of fifteen mills on agricultural
iand as defined by the statute. The term “agricultural
land” is defined in the statute to mean and include all
tracts of land of ten acres or more, and not laid off into
lots of less than ten acres or divided by streets and alleys
into parcels of less than ten acres and tracts of less than
ten acres belonging to and a part of other lands of more
than ten acres, lying within any school corporation in the
State of Iowa and in good faith used for agricultural or
horticultural purposes.
Under the statute in question owners of “agricultural
land” as defined by the statute, are required to pay only
a general school fund tax of fifteen mills on said property
regardless of the amount of said tax actually levied in the
school district in which the real estate is located. Owners
of real estate not meeting the requirements of the statute
regardless of its type and the use to which it is put, are
required to pay the general school fund tax levied thereon
to the full extent of the millage rate.
Appellant, the owner of agricultural land of less than
ten acres in size in Epworth School District, Dubuque
County, Iowa, brought action in the District Court of lowa
in and for Dubuque County, challenging the constitutional-
ity of said statute, Chapter 426 of the 1916 Code of Iowa,
and asking the Court to enter a declaratory judgment de-
creeing said statute unconstitutional.
The specific features of the statute, the constitutionality
of which appellant attacked were (1) the private purpose
of the statute and the appropriation provided therein, (2)
the arbitrary legislative classification, and (3) the amount,
manner and method by which the exemption or tax credit
ne Ree
7
and the allocation of said funds to the school district is
determined under the statute.
Defendants-appellees, asserted the statute was consti-
tutional.
The District Court declared the statute constitutional
on January 6, 1917. A copy of the Court’s decision is ap-
pended to the appellant's Jurisdictional Statement marked
Appendix “A”. Thereafter appeal was taken to the Su-
preme Court of the State of Iowa which court on February
10, 1918, in a five to three decision, with one Justice not
sitting, entered a judgment and decree reversing the Dis-
trict Court and holding the statute unconstitutional in that
(1) the purpose of the statute was private and not public,
and (2) the area classification of agricultural land to re-
ceive the benefits of the statute, and other land to be ex-
cluded was purely arbitrary and unreasonable. A copy of
said judgment and decree heing appended to appellant’s
Jurisdictional Statement marked Appendix “B” and re-
ported in 31. N. W. (2d) 110. Thereafter on December 14,
1948, more than ten months thereafter, the Supreme Court
of the State of Iowa, withdrew its previous judgment and
decree and entered in its stead a judgment and decree
holding that said statute was constitutional and that it was
not violative of the Iowa Constitution or the Fourteenth
Amendment to the Constitution of the United States. A
copy of said judgment and decree is appended to appel-
lant’s Jurisdictional Statement marked Appendix “C” and
the decision is reported in 35 N. W. (2d) 66. Thereafter
on March 11, 1949 a rehearing was denied appellant and
the judgment and decree became final on that date.
allie
BLEED THROU GH=POOR COPY
=
Points relied upon for reversal.
The Iowa Supreme Court erred in:
A. Holding and deciding that said state statute which
classifies agricultural lands separately from other types of
taxable real estate for purposes of school tax, school tax
exemption and state appropriations in payment of school
taxes on such types of property, does not constitute an
arbitrary and unreasonable classification which grants to
certain citizens and taxpayers rights and privileges not
equally granted to all citizens and taxpayers, in contra-
vention of Section 1 of the Fourteenth Amendment to the
Constitution of the United States.
B. Holding and deciding that said state statute which
classifies agricultural lands solely on the basis of their
having been laid off or platted into tracts of ten acres or
more, for the purposes of school tax, school tax exemption,
and state appropriations in payment of school taxes on
such types of property, does not constitute an arbitrary
and unreasonable classification which grants to certain
citizens and taxpayers rights and privileges not equally
granted to all citizens and taxpayers, in contravention of
Section 1 of the Fourteenth Amendment to the Constitution
of the United States.
C. Holding and deciding that said state statute which
classifies agricultural lands on the basis of their being lo-
cated in a school district in which the millage for the gen-
eral school fund exceeds fifteen mills, for the purposes of
school tax, school tax exemption and state appropriations
in payment of taxes on such types of property, does not
constitute an arbitrary and unreasonable classification
which grants to certain citizens and taxpayers rights and
privileges not equally granted to all citizens and taxpayers
~~ =
in contravention of Section 1 of the Fourteenth Amend-
ment to the Constitution of the United States?
D. Holding and deciding that said state statute which
benefits only citizens and taxpayers owning real estate, (1)
used for agricultural or horticultural purposes, and (2)
laid off or platted into tracts of ten acres or more, and (3)
located in a school taxing district in which the millage
rate is in excess of fifteen mills, operates equally upon all
citizens and taxpayers within the same class, and that said
classification does not grant to certain citizens and taxpay-
ers rights and privileges not equally granted to all citizens
and taxpayers, in contravention of Section 1, of the Four-
teenth Amendment to the Constitution of the United States.
E. Holding and deciding that said state statute which
appropriates public moneys, raised from statewide general
sources of taxation, to the payment of taxes of certain tax-
payers and citizens owning real estate of the type and kind
embraced by said statute in certain school districts of the
State, to the extent that the millage for the general school
fund is in excess of fifteen mills, constitutes a proportion-
ing of the tax to be borne by owners of land of the type
and kind embraced by the statute, as distinguished from
the tax to be borne by cilizens and taxpayers owning other
types of real estate, and in holding that said statute does
not in this respect constitute an arbitrary, non-uniform
and unreasonable classification which grants to certain
citizens and taxpayers rights and privileges not equally
granted to all citizens and taxpayers, in contravention of
Section 1 of the Fourteenth Amendment to the Constitu-
tion of the United States.
F. Holding and deciding that said state statute, which
exempts certain citizens and taxpayers from paying taxes
upon real estate of the type and kind embraced by said
statute and owned by them, provides a proper basis of
DLEED THROU GH—POOR COPY
a
tax exemption on the ground that it is an encouragement
and in aid of agriculture or to encourage the reorganiza-
tion of school districts within the state, and therefore based
upon a valid public purpose and public policy which
would justify such a classification and non-uniform opera-
tion of said statute in granting to certain taxpayers and
citizens rights and privileges not equally granted to all
citizens and taxpayers in contravention of Section 1 of the
Fourteenth Amendment to the Constitution of the United
States. On the contrary appellant's position is that said
state statute does not aid agriculture in any manner, does
no operate to encourage the reorganization of school dis-
tricts within the state and does not serve any public purpose
whatsoever.
G. Holding and deciding that the said state statute
which appropriates public moneys raised from statewide
general sources of taxation, to the payment, by a “credit”
system, of taxes of certain taxpayers and citizens owning
real estate of the type and kind embraced by said statute,
to an extent arbitrarily determinéd to be the amount that
the tax levied for the general school fund exceeds the
amount of tax which would be levied on the respective
tracts of land if the levy for the general school fund were
fifteen mills, is a proper method of appropriating state
funds and that it does not deprive certain citizens and
taxpayers of property without due process of law, and does
not grant to certain taxpayers and citizens rights and privi-
leges not equally granted to all citizens and taxpayers, in
contravention of Section 1 of the Fourteenth Amendment
to the Constitution of the United States.
H. Holding and deciding that said state statute which
appropriates public moneys raised from statewide general
sources of taxation, to the payment, by a “credit” system,
of individual taxes of certain taxpayers and citizens own-
i i a
oa
a
ing real estate of the type and kind embraced by the statute,
without any limit to the amount of such benefit which an
individual taxpayer may receive, and which credit is ar-
bitrarily determined to be the amount that the tax levied
for the general school fund on each tract of such lands
owned by him exceeds the amount of tax which would be
levied thereon if the levy for the general school fund were
fifteen mills, is a proper method of appropriating state
funds for a valid primary public purpose and that the
classification employed therein does not deprive certain
citizens and taxpayers of property without due process of
law and does not grant to certain taxpayers and citizens
rights and privileges not equally granted to all citizens
and taxpayers, in contravention of Section 1 of the Four-
teenth Amendment to the Constitution of the United States.
The federal questions here involved have never been
decided by this court.
The statute whose validity is involved herein is a statute
of state wide application and has to do only with general
school taxes.
The federal questions involved herein are:
1. Is the purpose of the statute public?
2. Are the classifications provided by the statute
reasonable and designed to carry out a public purpose?
The classifications are as follows:
a. Agricultural lands (as defined by the statute), sep-
arate and apart from other-#eal estate.
b. Agricultural lands separate and apart from other
agricultural lands whose use and location is the same
simply because of the size of the tracts.
ce. Agricultural lands separate and apart from other
agricultural lands whose size and use is the same simply
because of its location in a school district where the millage
exceeds fifteen mills for general school tax purposes.
BLEED THROU GH=—POOR COPY
oii
3. The validity of the procedure provided under the
statute to determine the amount of benefits to be received
by each land owner coming under the statute.
The foregoing federal questions have never been de-
cided by this Court.
Assuming without admitting that the federal questions
relied upon herein have heretofore been decided by this
court, a motion to dismiss or affirm will not be sustained
where analysis and exposition are necessary in order to
make clear the decisive effect of such prior decisions and
there is conflict in the decisions of the various state courts
of last resort upon the question, and a division of the Court
below.
AUTHORITIES.
American Sugar Refining Co. v. Louisiana, 179
U. S. 89, 21 S. Ct. 43, 45 L. Ed. 102.
Bayside Fish Flour Co. v. Gentry, 297 U. S. 422,
429, 56 S. Ct. 513, 80 L. Ed. 772, 777.
Connolly v. Union Sewer Pipe Co., 184 U. S. 540,
558, 22 S. Ct. 431, 46 L. Ed. 679, 689.
Fiske v. Kansas, 274 U. S. 380, 47 S. Ct. 655, 71 L. Ed.
. 1108.
Keefner v. Porter, 228 la. 844, 293 N. W. 501.
Lawrence v. State Tax Commission, 286 U. S. 276,
52 S. Ct. 556, 76 L. Ed. 1102.
Louisville & Nashville R. R. Co. v. Melton, 218 U. S.
36, 47, 54 L. Ed. 921, 926.
Simmons v. Ericson (S. D.) 223 N. W. 342.
ARGUMENT.
Assuming without admitting that the federal questions
involved herein have heretofore been decided by this court,
appellees’ motion to dismiss or affirm should not be sus-
a
=_ =
tained for the reason that an analysis and exposition of
the statute, the record and the points relied upon by ap-
pellant for reversal, are required in order to make clear
the effect of such prior decisions if any there are.
Our search discloses only two state decisions involving
a statute in any way similar to the one in question, Keefner
v Porter, 228 la. 811, 293 N. W. 501, which involved a simi-
lar lowa statute classifying agricultural land located in
independent school districts separate and apart from all
other types of real estate for general school taxes. The
Iowa Supreme Court held the statute invalid on the ground
that the classification contained therein was arbitrary
and unreasonable and was not calculated to further any
proper public purpose and that the classification did not
provide for a basis which would effectually single into a
separate class persons or objects with which purpose of
legislature is concerned and that there was no reasonable
relationship between the purpose of the legislation and
basis of classification set out in the statute.
The statute whose validity is now before this Court is
the identical statute involved in the Keefner case except
that the statute classifies agricultural land (as defined by
the statute) located in a school district for general school
‘tax purposes, separate and apart from all other real estate.
In Simmons v. Ericson, (S. D.) 223 N. W. 312, “agricul-
tural land” for the purpose of the statute involved was de-
fined as all land not platted in city or town lots, used ex-
clusively for farm and agricultural purposes and provided
that no agricultural land within an independent school dis-
trict shall in any year be taxed to exceed ten mills on the
dollar of the assessed valuation for school purposes, while
other lands or real estate within the district could be taxed
twenty-five mills on the dollar.
The plaintiff contended that the limitation of the levy
on agricultural land to ten mills on the dollar, while other
DLEED THROUGH=-POOR COPY
_ —
idles,
lands or real estate within the district may be taxed twenty-
five mills on the dollar, was in violation of that provision of
the Constitution, that taxes shall be uniform on all prop-
erty of the same class.
The court held the classification arbitrary and unreason-
able and the statute therefore invalid. At page 454 of the
Northwestern citation the Court said:
“We are unable to see any difference which furnishes
a reasonable ground for making a distinction between
the rate of taxation for school purposes upon agricul-
tural lands and that upon other real estate within the
same school district.”
The Constitution of South Dakota was later amended
permitting the classification of agricultural land for school
purposes separate and apart from other real estate.
That there was a definite division in the Court below
cannot be doubted. This is the second time that the statute
has been before the Supreme Court of Iowa with some
variations in its contents. The statute originally classified
agricultural land located in independent school districts
for general tax purposes, separate and apart from all other
real estate including agricultural land that was not located
in an independent school district. The lowa Supreme
Court in the case of Keefner v. Porter, Supra, held the stat-
ute invalid because of the arbitrary and unreasonable
classification contained therein. The statute whose validity :
is attacked herein is identical with the statute in the Keef-
ner case, except that the statute classifies agricultural land,
as defined by the statute, located in any school district
separate and apart from all other real estate, for general
school tax purposes. In a five to three decision, one Jus-
tice not sitting, reported in 31 N. W. (2d) 110, held the stat-
ute invalid on the ground that the purpose of the statute was
private and the classification contained therein was un-
a
reasonable and not designed to carry out any public pur-
pose. Ten months later in a six to three decision the lowa
Supreme Court withdrew its former opinion and held the
statute valid.
What may be regarded as a denial of due process and
equal protection of the law is not always as easily deter-
mined, as the decisions of this court and the highest Courts
of the states show. As said by this Court in the case of
Connolly v. Union Sewer Pipe Co., 184 U.S. 540, 558:
“No rule can be formulated that will cover every case.”
Each case must stand or fall on its own merits.
The points relied upon for reversal are set forth and
argued in the following propositions in the order in which
they appear in the Assignment of Errors.
PROPOSITION A.
The lowa Supreme Court erred in holding that said
statute which classifies agricultural land separate and apart
from other lands for purposes of general school taxes, gen-
eral school tax exemptions and state appropriations in pay-
ment of general school taxes on lands, does not constitute
an arbitrary and unreasonable classification which grants
to certain citizens aad taxpayers, rights and privileges not
equally granted to all citizens and taxpayers in contraven-.
tion of Section 1 of the Fourteenth Amendment to the Con-
stitution of the United States.
1. The Legislature may classify but a classification may
not be arbitrary or unreasonable and must be calculated
to further some public purpose, and classification must
provide for a basis which will effectually single into a
separate class persons or objects with which purpose of
Legislature is concerned and there must be a reasonable
relationship between purpose of legislation and basis of
classification set out in the statute.
BLEED THROU GH—POOR COPY
= =
AUTHORITIES.
Appeal of York & Foster, (Pa.) 43 A. (2d) 557.
Bell v. Town of Pulaski, (Tenn.) 1841S. W. (2d) 384.
Cary v. City of Pekin, 88 Il. 154.
Copeland v. City of St. Joseph (Mo.) 29S. W. 281.
Corporation of Sevierville v. King, (Tenn.) 184
S. W. (2d) 381.
Essex County Park Commission v. Town of West
Orange, (N. J.) 73 A. 512.
Gulf, C. & S. F. R. Co. v. Ellis, 165 U.S. 150, 165, 17
S. Ct. 255, 41 L. Ed. 666, 668, 672.
Keefner v. Porter, 228 la. 844, 293 N. W. 501.
Monaghan v. Lewis (Del.) 59 A. 948.
Opinion of Justices, (Maine) 55 A. 827.
Power Mfg. Co. v. Saunders, 274 U. S. 490, 494, 47
S. Ct. 678, 71 L. Ed. 1165.
Simmons v. Ericson, (S. D.) 223 N. W. 342.
Smith v. City of Americus, (Ga.) 15 S. E. 752.
Truazx v. Corrigan, 257 U. S. 312, 333, 42 S. Ct. 124,
66 L. Ed. 254, 263.
2. While the Legislature is free to make classifications
in the application of a statute which are relevant to the
legislative purpose the ultimate test of the validity is not
whether the classes differ, but whether the differences be-
tween them are pertinent to the subject in respect of which
the classification is made.
AUTHORITIES.
Asbury Hospital v. Cass Co., 326 U. S. 207, 214, 66
S. Ct. 61, 65, 90 L. Ed. 6, 13.
Metropolitan Casualty Insurance Co. v. Brownell,
294 U. S. 580, 583, 55 S. Ct. 538, 539, 79 L. Ed. 1070.
Power Mfg. Co. v. Saunders, 274 U. S. 490, 494, 47
S. Ct. 678, 71 L. Ed. 1165.
oe
aes
3. In considering the classification of a law, not only
its final purpose must be regarded, but the means of its
administration.
Adams v. Milwaukee, 228 U. S. 572, 582, 33 S. Ct.
610, 57 L. Ed. 971, 977.
St. John v. New York, 201 U. S. 633, 26 S. Ct. 554,
50 L. Ed. 896.
4. School taxes are for the benefit of all people. It is
a tax for a public purpose.
51 Am. Jur., taxation, Section 9.
Chicago, M. & St. P. Ry. Co. v. Phillips, 111 Ta. 377,
82 N. W. 787, 61 C. J., taxation, Section 3.
1 Cooley, taxation, Fourth Edition, 213-215.
Kelly v. Pittsburgh, 101 U. S. 78, 26 L. Ed. 658, 659,
660.
Morton Salt Co. v. City of South Hutchinson, 159
Fed. (2d) 897.
Thomas v. Gay, 169 U. S. 264, 280, 18 S. Ct. 340, 42
L. Ed. 740, 746.
Wright v. House, 188 Ind, 247, 121 N. E. 433 at 435.
‘
ARGUMENT.
Section 1 of the Fourteenth Amendment to the Consti-
tution of the United States provides that:
“No State shall make or enforce any law which shall
abridge the privileges or immunities of citizens of the
United States; nor shall any State deprive any person
of life, liberty, or property, without due process of
law; nor deny to any person within its jurisdiction the
equal protection of the laws.”
There are only two states where the Legislature has at-
tempted to classify agricultural lands separate and apart
from all other real estate for general school tar purposes,
namely, the states of South Dakota and Iowa. The South
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= =
Dakota Supreme Court held the classification arbitrary and
unreasonable in the case of Simmons v. Ericson, 223 N. W.
342, on January 26, 1929 at a time when the state was in
the midst of a depression caused by a prolonged drought.
The statute defined “agricultural lands” as all lands not
platted in city or town lots, used exclusively for farm and
agricultural purposes and provided that no agricultural
land within an independent school district shall in any
year be taxed to exceed ten mills on the dollar of the as-
sessed valuation for school purposes, while other lands or
real estate within the district could be taxed twenty-five
mills on the dollar. It was contended that the limitation
of the levy on agricultural land to ten mills on the dollar,
while other lands or real estate within the district may be
taxed twenty-five mills on the dollar, is in violation of that
provision of the Constitution, that taxes shall be uniform
on all property of the same class.
At page 343 of the Northwestern citation the Court said:
“We are unable to see any difference which furnishes
reasonable ground for making a distinction between the
rate of taxation for school purposes upon agricultural
lands and that upon other real estate within the same
school district. There is no more difficulty in discov-
ering the property for assessment in the one case than
in the other, or in ascertaining its value for the purpose
of assessment in the one case than in the other. It
is argued by appellant that the Court must take judicial
notice that the relative number of families, and there-
fore of children, upon agricultural lands within the
district is much smaller than that within the municipal
area which is divided into blocks and lots. But the
number of children that a taxpayer has bears no rela-
tion to the amount of tax he may be required to con-
tribute for the support of the schools. Non-residents
and persons who have no children may be called upon
to contribute in a much larger degree for the support
of the school in the community in which they own
=— =
property than residents who have large families, many
of the children attending school and receiving in-
structions therein. In this school district the average
farm of 160 acres, including all structures and improve-
ments, is assessed at approximately $11,000.00. At the
maximum rate of taxation authorized by Chapter 102,
Laws of 1923, on agricultural lands, the school tax on
such a farm would be $110.00. The owner of a store
building and lot of the same valuation within the
platted portion of the muncipality could he taxed, for
school purposes in the same school district, $275.00. We
think the placing of agricultural lands within the
school district in a different class than that of other
real estate is not based on differences in the character
of the property which furnish a reasonable ground for
making a distinction between the two classes, and that
it really results in permitting agricultural land to es-
cape a burden imposed on other real estate situated in
substantially similar circumstances and conditions,
and that the limitation of 10 mills on the dollar in the
case of agricultural land while the levy on other real
estate may be 25 mills on the dollar contravenes that
provision of the Constitution that taxes shall be uni-
form on all property of the same class.”
The original lowa statute classifed, for general school
fund tax purposes, agricultural lands located in independ-
ent school districts separate and apart from other real
estate. The lowa Supreme Court held the classification to
be arbitrary and unreasonable in the case of Keefner v.
Porter, 228 la. 844, 293 N. W. 501. ‘The statute in the Keef-
ner case was the same as the statule whose valdity is at-
tacked in this case except that the present statute classifies
all agricultural land, as defined by the statute, separate and
apart from all other real estate for general school tax pur-
poses.
In the usual case of claimed discrimination the situation
arises by reason of the lack of uniformity in valuation.
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= “=
Here the situation arises through a statutory attempt to
create a special class of property for general school tax
purposes and extends a favorable rate thereto. The vice
of the situation is in compelling one taxpayer to pay more
than a proper proportion of the total school tax as com-
pared with others similarly situated, while at the same time
requiring him to contribute to the general tax fund from
which all general school taxes of the favored taxpayer,
over fifteen mills, are paid. ‘The apparent purpose of the
statute is to shift from the owners of agricultural land, as
defined by the statute, at least in part, the school tax bur-
den to the public not benefited by the statute and in addi-
tion to require the laboring man, the tenant farmer, the of-
fice worker and the balance of the public who are excluded,
who always bear the burden of all tax exemption, must bear
an increased tax burden to accomplish this special non-
public purpose, namely, the paying of the general school
tax of the favored taxpayer over fifteen mills.
The lowa Supreme Court attempts to justify the shift-
ing of the tax burden from agricultural lands as defined
by the statute to the public and other real estate, on the
theory that agricultural land does not receive the same bene-
fits from schools as other real estate and that the statute
equalizes, at least in part, by tax exemption, the tax burden
for schools to the benefit received. The fallacy of the
court’s reasoning can readily be seen. A school tax is not
laid upon property in order merely to benefit the land by
allowing people who live on the property or in the area to
go to schools erected and maintained by the school tax.
It is laid for a public purpose. The school tax is like that
for the support of government. It is for the benefit of all
the people. It is a tax for a public purpose. All enjoy the
beneficial results of education and the better order and
government arising therefrom, irrespective of the amounts
respectively contributed by each. The test of equality of
—
— =
school taxes is not direct benefit of school attendance by
pupils who occupy the land taxed. Were that true the |
childless man would be exempt from the support of schools,
and the sane and well from the support of hospitals. There
is no irregularity merely because the benefit resulting from
the school tax are enjoyed by those who pay it, in different
degrees or because some enjoy some particular benefit such
as school attendance and others do not. Everyone in the
state enjoys the higher social order that flows from the
state’s educational system. A general tax law such as a
school tax law exacts contributions in return for general
benefits of a government that establishes a school system.
The duty to pay school taxes is found in the participation
of general benefits. It cannot be laid or measured by a tax-
payer’s participation in some special benefit. In the case
of Kelly v. Pittsburgh, 101 U.S. 78, 83, 26 L. Ed. 658, 660, the
distinct ground on which Section 1 of Article 14 was in-
voked, was that the eighty acres of land of the defendant
was and always has been used as farm land for agricul-
tural use only, and cannot for that reason be subjected to
taxation for ordinary cily purposes. The Court at page
83 of the U. S. citation said:
“It is urged, however, with much force, that though
land of this character, land which its owner has not
laid off into town lots, but which he insists on using
as agricultural land, through which no streets are run
or used, cannot be, even by the Legislature, subjected
to the taxes of a city, the water tax, the gas tax, the
street tax, and others of similar character. The reason
for this is said to be that such taxes are for the benefit
of those in a city who own property within the limits
of such improvements and use, or might use them if
they choose, while the owner of this land reaps no such
benefit. Cases are cited from the higher courts of
Kentucky and Iowa where this principle is asserted,
and where those courts have held that farm lands in a
city are not subject to the ordinary city taxes.
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_—_
a.
It is no part of our duty to inquire into the grounds
on which those courts have so decided. They are ques-
tions which arise between the cilizens of those States
and their own cily authorities, and afford no rule for
construing the Constitution of the United States. —
We cannot say judicially that Mr. Kelly received no
benefit from the city organization. ‘Lhese streets, 1
they do not penetrate his farm, lead to it. The water-
works will probably reach him some day, and may be
near enough to him now to serve him on some occasion.
The schools may receive his children, and in this re-
gard he can be in no worse condition than those living
in the City who have no children, and yet who pay for
the support of the schools. Every man in a county, a
town, a city, a State, is deeply interested in the educa-
tion of the children of the community, because his
peace and quiet, his happiness and prosperily, are
largely dependent upon the intelligence and moral
training which it is the object of public schools to sup-
ply to the children of his neighbors and associates, if
he has none himself.” (Italics Supplied.)
PROPOSITION B. ;
The lowa Supreme Court erred in holding and deciding
that said statute which classifies agricultural lands solely '
on the basis of their having been laid off or platted into
tracts of ten acres or more, for general school tax, general
school tar exemption and state appropriations in payment
of general school taxes on such types of property, does not
constitute an arbitrary and unreasonable classification
which grants to certain citizens and taxpayers rights and
privileges not equally granted to all citizens and taxpayers
in contravention of Section 1 of the Fourteenth Amendment
to the Constitution of the United States.
A statute which classifies agricultural land for general
school tax purposes separate and apart from other agri-
a
—22—
cultural lands whose use and location is the same simply
because the size of the tracts is arbitrary and unreasonable
and violates Section 1 of the Fourteenth Amendment to
the Constitution of the United States.
AUTHORITIES.
Brinkerhof{{-Farris Trust & Savings Co. v. Hill, 281
U. S. 673, 680, 50S. Cty 451, 454, 74 L. Ed. 1107,
Engel v. O'Malley, 219 U. S. 128, 138, 31 S. Ct. 190,
55 L. Ed. 128, 136.
Kelly v. Pittsburgh, 104 U. S. 78, 83, 26 L. Ed. 658,
659.
State ex rel Welsh v. Darling, 216 la. 553, 246 N. W.
390, 391.
Appellant is a resident and the owner of a tract of land
4.13 acres in size situated in Epworth School District, Du-
buque County, lowa, and is used solely for agricultural
purposes. (Record on appeal to the State Supreme Court,
page 18, lines 9 to 23) Appellant's tract is devoted to the
same agricultural uses as other agricultural land of ten
acres or more located in said school district. (Record on
appeal to the State Supreme Court, page 48, lines 23 to 29)
The general school tax for Epworth School District for
the year 1946 was 30.899 mills. The appellant's said 4.13
acre tract was valued for tax purposes at $2,322.00. The
general tax assessed against said tract for the tax due in
the year 1946 was $71.75. Michael Hoffman resides in the
same school district, owns a tract of agricultural land con-
sisting of 87.34 acres. This property was valued for tax
purposes at $2,483.00. The general school tax against the
property for the tax due in the year 1916 was $76.22. (Rec-
DLEED THROUGH=—POOR COPY
—
—
ord on appeal to the State Supreme Court, page 18, lines 24
to 34, and page 19, lines 1 to 16)
Under the statute appellant is required to pay $71.75 in
general school taxes on 4.13 acres of agricultural land
whereas Hoffman would receive a credit of 15.899 mills or
$39.90 and would be required to pay the $36.92 in general
school fund taxes on the same kind of property consisting
of 87.34 acres.
A reading of the record will disclose that there are
thousands of acres of lowa agricultural land that do not
receive any benefits under the statute simply because the
land happens to be surveyed off into tracts of less than ten
acres.
Thus we see that tracts of agricultural land whose loca-
tion and use is the same is classified separate and apart
from each other simply because of the difference in size
of the tracts. No court in this land has ever upheld a classi-
fication of this kind where as in this case, size is not an in-
dex to the admitted evil. As said by this Court in the case
of Engel v. O'Malley, 219 U. S. 128, 138, 31 S. Ct. 190, 55 L.
Ed. 128, 136:
“Where size is not an index to an admitted evil, the
law cannot discriminate between the large and the
small,”
The cases cited by appellees as authority for this kind of
classification are not in point. The basic question of the
right to classify for general school taxation placing agricul-
tural tracts of different sizes in different classes, was neither
considered or decided and if it had been the state court
decisions would not be binding upon this court. As said by
this Court in the case of Kelly v. Pittsburgh, 104 U. S. 78, 83,
26 L. Ed, 658, 659:
“It is urged, however, with much force, that though
land of this character, land which its owner has not
————
iis.
laid off into town lots, but which he insists on using
as agricultural land, through which no streets are run
or used, cannot be, even by the Legislature, subjected
to the taxes of a city, the water tax, the gas tax, the
street tax, and others of similar character. The reason
for this is said to be that such taxes are for the benefit
of those in a city who own property within the limits
of such improvements and who use, or might use them
if they choose, while the owner of this land reaps no
such benefit. Cases are cited from the higher courts of
Kentucky and Iowa where this principle is asserted, and
where those courts have held that farm lands in a city
are not subject to the ordinary city taxes.
It is no part of our duty to inquire into the grounds
on which those courts have so decided. They are ques-
tions which arise between the citizens of those States
and their own city authorities, and afford no rule for
construing the Constitution of the United States.”
As said by this Court in the case of Asbury Hospital v.
Cass Co., 326 U.S. 207, 214, 66 S. Ct. 61, 65, 90 L. Ed. 6, 13:
“The ultimate test of validity is not whether the classes
differ but whether the differences between them are
pertinent to the subject in respect of which the classi-
fication is made.” (Italics supplied.)
Applying this test to the classification involved herein can
there be any question but what the classification is purely
arbitrary and unreasonable? Is the difference in size of
two tracts which are focated in the same district whose type
and character is the same and used for the same purpose,
pertinent to the subject in respect of which the classifica-
tion is made?
We submit that the classification is arbitrary and un-
reasonable and is not pertinent to the subject in respect of
which the classification is made; that the validity of such
classification has never been passed upon by this Court;
that the classification is in violation of Section 1 of the
BLEED THROU GH=—POOR COPY
een
—
Fourteenth Amendment to the Constitution of the United
States and involves a federal question that is substantial in
character.
PROPOSITION C.
The lowa Supreme Court erred in holding and deciding
that said state statute which classifies agricultural lands on
the basis of their being located ina school district in which
the millage for the general school fund exceeds fifteen mills
for the purpose of school tax exemption and state appro-
priations in payment of taxes on such types of property
does not constitute an arbitrary and unreasonable classifi-
cation which grants to certain cilizens and taxpayers rights
and privileges not equally granted to all citizens and tax-
payers in contravention of Section 1 of the Fourteerth
Amendment to the Constitution of the United States.
The classification of agricultural lands in school dis-
tricts where the millage rate for school purposes exceeds
fifteen mills separate and apart from agricultural land lo-
cated in school districts where the millage rate is fifteen
mills or less and the size, character, type and uses for the
same are purely arbitrary and in violation of Section 1 of
the Fourteenth Amendment to the Constitution of the United
States.
ARGUMENT.
The classification is based arbitrarily on the location
of the property, namely, whether the property is located
within or without a school district where the millage rate
for school tax purposes exceeds fifteen mills and whether
the landowner receives any benefits under the statute de-
pends entirely upon the millage rate that the district school
board fixes.
To our knowledge no legislative body except the Iowa
—23—
Legislature has ever enacted a law of state-wide applica-
tion carrying with it an appropriation raised by state-wide
taxation where the power is delegated to the local school
district to determine its own benefits under the statute,
based upon the estimates of its necessary school tax. The
result is a gross disparity and complete lack of uniformity
of benefits, an arbitrary and discriminatory incentive for
excessive and extravagant school programs to receive
private and local benefits with utterly no primary public
benefit to the state.
The validity of the classification involved in this propo-
sition has not been passed upon by this Court or the highest
Court of any state and is substantial in character.
PROPOSITION D.
The lowa Supreme Court erred in holding and deciding
that said state statute which benefits only citizens and tar-
payers owning real estate (1) used for agricultural or horti-
cultural purposes, and (2) laid off or platted into tracts of
fen acres or more, and (3) located in a school taxing dis-
trict in which the millage rate is in excess of fifteen mills,
operates equally upon all citizens and taxpayers within the
same class, and that said classification does not grant to
certain citizens and taxpayers rights and privileges not
equally granted to all citizens and taxpayers, in contraven-
tion of Section 1 of the Fourteenth Amendment to the Con-
stitution of the United States.
AUTHORITIES.
Barbier v. Connolly, 113 U. 8. 27, 5 S. Ct. 357, 28 L.
Ed. 923.
Connolly v. Union Sewer Pipe Co., 184 U. 8. 540, 22
S. Ct. 431, 46 L. Ed. 679.
BLEED THROU GH=—POOR COPY
=— =
Cotting v. K. C. Stockyard Co., 183 U. S. 79, 22 S. Ct.
30, 46 L. Ed. 92.
Hayes v. Missouri, 120 U.S. 68, 7S. Ct. 350, 30 L. Ed.
578.
In re Opinion of Justices, 208 Mass., 616, 94 N. E.
1043.
Keefner v. Porter, 228 Ia. 844, 293 N. W. 501.
ARGUMENT.
This is a law whose application is state-wide and has
to do with state funds and not funds that are raised locally.
Therefore it should be bo. ue in mind that the class referred
to consists of all owners of agricultural land as defined
in the statute, situated throughout the state in school dis-
tricts where the millage for the general school fund tax is
fifteen mills or more and further, that each school district
where the general school fund tax millage is fifteen mills
or more does not constitute a separate class but is a part of
the class of owners of agricultural land throughout the
state in all districts where said millage is fifteen mills or
more. The Iowa Court has stated in the case ot Keefner
v. Porter, 228 1a. 814, 293 N. W. 501, 503, that property of a
class may be exempted from taxation provided always that
the classification is a proper one. But it is also well settled
that all members of a class shall be included in the taxing
act whether for the purpose of imposition of or exemption
from taxation and that if the law excludes from its opera-
tion a single member of a class, which it would other, ise
affect, it will be invalid. This Court has stated the rule
pertaining to the Fourteenth Amendment as follows:
“But upon this general question we have said that the
guaranty of the equal protection of the laws means
‘that no person or class of persons shall be denied the
same protection of the laws which is enjoyed by other
—w2a—
persons or other classes in the same place and under
like circumstances.’ ”
Connolly v. Union Sewer Pipe Co., 184 U. S. 40,
558, 22 S. Ct. 431, 46 L. Ed. 679, 689.
“ee 7 *
that no impediment should be interposed to the
pursuits of anyone except as applied to the same pur-
suits by others uoZer like circumstances.”
Barbier v. Connolly, 113 U. S. 27, 31, 5 S. Ct. 357,
359, 28 L. Ed. 923, 925.
Yick Wo v. Hopkins, 118 U. S. 356, 369, 6 S. Ct. 1064,
1070, 30 L. Ed. 220, 226.
“But while recognizing to the full extent the impossi-
bility of an imposition of duties and obligations mathe-
matically equal upon all, and also recognizing the
right of classification of industries and occupations, we
must nevertheless remember that the equal protection
of the laws is guaranteed, and that such equal protec-
tion is denied when upon one of two parties engaged
in the same kind of business and under the same condi-
tions burdens are cast which are not cast upon the
other.”
Cotting v. Godard (Kansas City Stockyard Co.), 183
U. S. 79, 112, 22 S. Ct. 30, 46 L. Ed. 79, 109.
From a reading of the statute here considered, it is
readily discernible, that under these requisites of a tax
exemption law the present statute is totally invalid for
lack of uniformity in operation even as among members
of the favored class itself.
In Iowa the general school fund tax rate of each school
district is determined by the local school board. Previous
to the passage of this statute, except for certain homestead
exemptions, the rate so determined applied equally to all
types of real estate within the district. In the enactment
of the Agricultural Land Tax Credit Act the lowa legisla-
ture has partially entered this field of local taxation by
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creating a state-wide favored class, to-wit: owners of land
of the type and kind favored by the statute. Regardless of
the local rate of taxation this favored group pays no more
than a fifteen mill tax. There is hence presenféd the prob-
lem of assimilating this favored state class into the hundreds
of school districts of the state whose financial structures
and tax rates are as many and varied as their number. As-
suming for a moment, without admitting, that the classifi-
cation is valid, the question then presented is whether this
dual system of tax rates, one set by the state Legislature
for the favored agricullural land-owning school taxpayers,
and the other set by the local district for all other school
taxpayers, can possibly be said to operate in a constitution-
ally uniform manner, either as between favored land-
owners and owners of non-favored realty, or between own-
ers of favored lands themselves.
While the argument may be advanced that the owners
of agricultural lands of equal value but located in different
school districts having a great disparity in millage rates,
actually pay no more than a fifteen mill tax upon their re-
spective properties, the conclusior and fact cannot be
escaped that the state in paying the taxes of the favored
few is actually helping certain members of the favored
class to a far greater extent than it is others equally en-
titled to its bounty, and that under the statute the propor-
tion to which this disparity may grow is unlimited. As in
the Keefner Case, Supra, the basis for the disparity of
treatment rests solely upon the arbitrary ground of loca-
tion. The words of the lowa Supreme Court in that case
were never more pertinent, and the situation in this case
is unchanged from that set of facts which led the lowa
Court to state at page 504 of the Northwestern citation and
we quote:
“None of us like to pay taxes, but when a neighbor is
forced to pay an additional tax, to be used in operating
—30—
the school of his neighbor, he is being discriminated
against. Equalization of tares cannot be brought about,
by shifting the tax from the shoulders of one farmer
to another, levying different amounts on the same kinds
of praperty.” (Italics supplied.)
In the Kee/ner case the disparity referred to was between
consolidated districts and independent districts with a mil-
lage rate under fifteen mills as distinguished from inde-
pendent districts with a millage rate of fifteen mills or
more. In the present case the disparity is between all
school districts to a greater or lesser extent dependent up-
on the millage rate therein.
Any attempt to coordinate local rates of school taxes
with the state-wide ceiling school tax rate on favored agri-
cultural landowners shows the mechanical impossibility of
achieving any sort of substantial uniformity of taxation.
Owners of favored land of identical value are benefited or
not by their ceiling tax of fifteen mills by the location of
their land in a high or low taxing district. In reality of
operation, the agricultural landowner may pay a school
tax rate equal to 100% where the local rate is fifteen mills,
while another owner of land of identical value and kind
pays on a tax rate equal to 25% where the local school tax
rate is sixty mills. Yet the requisite of the Fourteenth
Amendment is equality of taxation or exemption for all
members of the class created.
With the millage rate and the amount of general school
fund taxes in each school district being determined locally
by each district and not by a state-wide standard, it is as
impossible to obtain uniformity and equalization of the
burden of taxation to be borne by agricultural real estate
as it was under the statute in the Keefner case. It can
readily be seen that the classification of the agricultural
property of the taxing districts has for its basis the location
BLEED THROU GH=—-POOR COPY
=
of the property. It is not differentiated by its use or by
characteristics possessed by it.
Appellant’s-plaintiff's Exhibit 2 showing the 1916 Gen-
eral School Fund Tax for certain lowa counties proves be-
yond a reasonable doubt that this unchecked disparity be-
tween school districts operates to a much greater degree
than can be allowed under the most liberal interpretation
of the uniformity requirement of the Constitution. The
Exhibit, among other things, shows a general school fund
levy of 15.075 mills in Eden No. 1 District of Marshall
County and millage rates ranging to a high of 50.440 mills
in Coppock District of Washington County. The levy in
few, if any, of the districts is the same. Therefore the bene-
fits derived by the owners of agricultural land in the vari-
ous school districts where the millage rate varies would be
different. There is no standard in the statute providing
for equality or uniformity of treatment of such members
of said class outlined by the Legislature. Further the great
disparity of benefits resulting from the operation of the
statute has no reasonable relation to any purpose that can
be attributed to the statute in question.
In considering similar legislation which allowed real
estate to be taxed according to the varying local rates while
taxing personal property at a set state-wide rate the Massa-
chusetts Court in declaring such legislation unconstitutional,
in the case of In re Opinion of Justices, 208 Mass. 616, 94 N.
E. 1043, 1044 states:
“The rate upon personal property in any city or town
in any year would be different from the rate of taxa-
tion upon real estate in that city or town. The taxa-
tion upon personalty would be the same throughout
the state, and would be determined by the average rate
upon real estate assessed for local taxation in the pre-
ceding year. This might vary from the average rate of
taxation upon real estate for the current year. As the
rates of local taxation upon real estate would differ
a
“ie
greatly in different places, the rate in any place might
differ widely from the average rate. The result would
be that a person having an imvestment of $10,000 in
real estate would be obliged to bear a materially dif-
ferent part of the public burden from one in the same
city or town having an investment of the same amount
in personal property. We answer the first question in
the negative.”
The statute in question presents the situation of a state-
wide fifteen mill ceiling of taxation upon individuals of
the same class but with the rate of taxation being deter-
mined locally by each individual school district. From
the standpoint of an arbitrary dual tax standard, the situa-
tion in the present case is the same as in In Re Opinion of
Justices, 208 Mass. 616, 941 N. E. 1043, wherein the Massa-
chusetts Court held such legislation unconstitutional. The
exemption in the case at bar operates purely on local rates
of taxation for purely local use. It has nothing to do with
the raising of state funds for total state public use. The
local rates of taxation can and do vary greatly above and
below the fifteen mill ceiling as has been showa in said
Exhibit 2. The benefit to various landowners within the
designated class is totally dependent upon local rates and
necessarily operates in a non-uniform manner throughout
the state.
The only way in which a school district's taxpayers,
even though they are owners of “agricultural land”, can
receive benefits or break even under the operation of the
statute is to have the local millage rate above the average
rates of all the districts in the state. Tax dollars raised
from general tax sources will flow from the districts with
lower school taxes to those whose districts require the
greatest contribution by the state. The end result can only
be a mad scramble in all districts to raise and to continue
to raise the millage rates to receive the benefits of said state
BLEED THROU GH=—POOR COPY
——
=
paid taxes and to benefit not by the uniformity of the opera-
tion of the statute, but to avoid loss by its intrinsic non-
uniformity of operation.
It is apparent that whether the statute is primarily for
the benefit of the individual agricultural landowner with a
resultant disparity and non-uniformity of operation among
said landowners within the benefiting class, or primarily a
gift by the state to the districts eligible to receive such
benefits, that both of these theories present such short-
comings as prove beyond a reasonable doubt, that the stat-
ute in question is an ill conceived and poorly formulated
piece of legislation and should not be allowed to stand re-
gardless of the so called “public purposes” attributed to it.
From a reading of the statute it is apparent that the
classification involved in this proposition is arbitrary and
unreasonable and does not further any public purpose and
is in contravention of Section 1 of the Fourteenth Amend-
ment to the Constitution of the United States. The federal
question involved is substantial in character.
PROPOSITION E. )
The lowa Supreme Court erred in holding and deciding
that said state statute which appropriates public moneys,
raised from state-wide general sources of taxation, to the
payment of general school taxes of certain taxpayers and
citizens owning real estate of the type and kind embraced
by said statute in certain school districts of the State, to
the extent that the millage for the general school fund is
in excess of fifteen mills, constitutes a proportioning of the
tax to be borne by owners of land of the type and kind em-
braced by the statute, as distinguished from the tax to be
borne by citizens and taxpayers owning other types of real
estate, and in holding that said statute does not in this re-
spect constitute an arbitrary, non-uniform and unreasonable
ny
ss
classification which grants to certain citizens and taxpayers
rights and privileges not equally granted to all citizens and
taxpayers, in contravention of Section 1 of the Fourteenth
Amendment to the Constitution of the United States.
AUTHORITIES.
Airway Electric Appliance Corp. v. Day, 266 U. §,
71, 45 S. Ct. 12, 69 L. Ed. 169.
Funke v. Lancaster Co., 110 Neb. 635, 194 N. W. 807.
Gast Realty and Investment Co. v. Schneider Gran-
ite Co., 240 U. S. 55, 36 S. Ct. 254, 60 L. Ed. 523.
Houck v, Little River Drainage Dist., 239 U. S. 254,
36 S. Ct. 58, 60 L. Ed. 266.
61 C. J. Sec. 388 page 388.
In re Opinion of Justices, 195 Mass. 607, 84 N. E.
499.
Kansas City St. R. Co. v. Road Imp. Dist. No. 6, 256
U. S. 658, 41 S. Ct. 604, 65 L. Ed. 1151.
Louisville Gas & Elec. Co. v. Coleman, 277 U. §. 32,
48 S. Ct. 423, 72 L. Ed. 770.
Martin v. District of Columbia, 205 U. S. 135, 27
S. Ct. 440, 51 L. Ed. 743.
People v. Klehm, 350 Ill. 419, 183 N. E. 454, 457.
ARGUMENT.
The Iowa Supreme Court in its majority opinion re-
ported in 35 N. W. (2d) 66, at page 72 stated:
“Further, a classification, as in the act here, for the
purpose of proportioning the tax may be valid even
though such a classification would be invalid for the
purpose of applying a complete exemption.”
It is submitted that this statement demonstrates the fallacy
of the statute under consideration and betrays its lack of
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a
oa 35
the quality of uniformity in operation. There is no “propor-
tioning” of the tax within the accepted meaning of that
word. “Proportion” means “the relation of one thing to
another in respect to size, quantity, magnitude of corres-
ponding parts”, or “the relation of one part to another or
to the whole with respect to magnitude”. Funke v. Lancaster
County, 194 N. W. 807, 110 Neb. 635. “Proportion”, stated
the Illinois Court in People v. Klehm, 183 N. E. 454, 457, 350
Ill. 419, “is defined as that which falls to one’s lot when the
whole is divided according to a rule or principle.” A pro-
portional tax or tax exemption should bear a direct relation
to the total district school tax. Instead of this, in the present
case, regardless of the heights to which the school tax may
soar, the agricultural landowners’ tax remains at a con-
stant and inflexible rate of fifteen mills.
As has been pointed out by plaintiff-appellant’s Exhibit
2, this statute embodies on the one hand a fixed and inflexi-
ble rate of fifteen mills of general school tax upon the
favored landowner class, irrespective of the local tax rate,
while all others must pay according to what the local rate
in fact is. One member of the favored class may pay a
“proportionate” rate of 100% in a fifteen mill taxing dis-
trict, while another member may pay a “proportionate” rate
of 25% in a sixty mill taxing district. Yet the Iowa Su-
preme Court has held in the foregoing quotation that this
“proportioning” augments the constitutionality of the stat-
ute, “even though such a classification would be invalid for
the purpose of applying a complete exemption.”
The foregoing example clearly shows that nothing is
further from the fact. A “proportioning” of the agricul-
tural landowner’s tax rate to the local tax rate is a mechani-
cal and mathematical impossibility under the operation of
this statute. A “proportioning” of the tax burden of the
agricultural landowner, so that each member of the favored
class itself would bear an equal share of the local tax rate
a
— =
is impossible of attainment. The operation can in no way
be compared to those tax classifications which by varied
rates assess certain properties at varying percentages of
full value, or which properties are taxed to bear a propor-
tionate or relative share of the total tax burden. There is
no standard relation between the “proportion” which one
favored landowner’s tax bears to his local rate and that of
another favored landowner in another school district with
a higher or lower rate. Neither is there a standard rela-
tion between the “proportion” of tax borne by a favored
landowner to the tax borne by an owner of land not bene-
fited by exemption.
A “complete exemption” as referred to by the Iowa
Court, and the fifteen mill ceiling exemption to agricul-
tural landowners concerned in the statute have the very
element in common which the court construes in the fifteen
mill ceiling as augmenting the constitutionality of the pres-
ent statute. The lowa Supreme Court has here not only
assumed that agricultural lands may possibly be found
by the Legislature to receive less benefit from school taxes
than other real estate but it has also found by approving
this statute that benefit cannot exceed a fifteen mill as-
sessment on the valuation of agricultural property regard-
less of the development of educational facilities in the area.
In upholding this phase of the statute the lowa Supreme
Court cited cases and statutes regarding classification of
agriculiural lands separate from other types of real estate,
placing particular reliance upon Minnesota statutes. But
not one of these cases involves a ceiling exemption on
general school fund taxes. These statutes and the cases
construing them had to do with proportionate levies in the
true sense. No proportion exists among taxpayers’ rates
of taxation when within the same district unbenefited tax-
payers must pay more or less as the needs of the district
BLEED THROU GH—POOR COPY
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—_—_
rise and fall while the tax upon a select group of property
owners remains constant.
The statement of Mr. Justice Holmes in the case of Gast
Realty and Investment Co, v. Schneider Granite Co., 240
U. $. 55, 36S. Ct. 234, 60 L. Fd, 523, in condemning an as-
sessment ordinance with a mechanically faulty base is pe-
culiarly applicable to the type of legislation here under con-
sideration. Mr. Justice Holmes states at page 59 of the
U. S. Citation:
“The differences were not based upon any considera-
tion of difference in the benefits conferred, but were
established mechanically in obedience to the criteria
that the charter directed to be applied. The defend-
ants’ case is not an incidental result of a rule that, as
a whole and on the average, may be expected to work
well, but of an ordinance that is a farrago of irrational
irregularities throughout. It is enough to say that the
ordinance following the orders of the charter is bad
upon its face as distributing a local tax in grossly un-
equal proportions, not because of special considerations
applicable to the parcels taxed, but in blind obedience
to a rule that requires the result. And it cannot be
said that the ordinance as a whole may be regarded
as an individual exception under a rule that promises
justice in all ordinary cases.”
In the Gast case, Supra, at page 59 of the U. S. citation,
Mr. Justice Holmes states the rule of uniformity of opera-
tion within the class as follows:
“But—if the law is of such a character that there is no
reasonable presumption that substantial justice gen-
erally will be done, but the probability is that parties
will be taxed disproportionately to each other, and to
the benefit conferred, the law cannot stand against the
‘complaint of one so taxed in fact.” Citing Houck v.
Little River Drainage Dist. 239 U. S. 254, 36 3. Ct. 58,
60 L. Ed. 266; and Martin v. District of Columbia, 205
U. S. 135, 27 S. Ct. 440, 51 L. Ed. 743.
a
ee
In condemning legislation taxing foreign corporations
on a basis of a number of certain shares of stock, as the
sole determinant of the annual fee, this court stated in the
case of Airway Appliance Corp. v. Day, 266 U. S. 71, 85, 45
S. Ct. 22, 69 L. Ed. 169, 177, 178:
“Such a classification is not based on anything having
relation to the purpose for which it is made. * * * The
act has no tendency to produce equality; and it is of
such a character that there is no reasonable presump-
tion that substantial equality will result from its appli-
cation * * * The act violates the equal protection
clause of the 14th Amendment.”
In the case of Kansas City S. R. Co. v. Road Imp. Dist.
No. 6, 256 U. S. 658, 41 S. Ct. 604, 65 L. Ed. 1151, this Court
in following the rule of the Gast Case, Supra, condemned the
arbitrary assessment of railroad property in a manner dif-
ferent from other local realty, where the purpose of the
tax was local improvement. At page 661 of the U. S. cita-
tion this Court stated:
“Railroad property may not be burdened for local im-
provements upon a basis so wholly different from that
used for ascertaining the contribution demanded of
individual owners as necessarily to produce manifest
inequality. Equal protection of the law must be ex-
tended to all.”
The constitutional shortcoming of the ceiling exemption
in taxation and the inherent arbitrary nature of such taxa-
tion has been the subject of able discussion:
“Even where the right to exempt exists, the constitu-
tional requirement of uniformity is violated if the ex-
emption does not serve a public purpose, or if it is
merely a partial exemption conditional upon the prop-
erty exempted paying an arbitrary percentage which
is not proportional.” 61 C. J. Sec. 388, page 338.
OHLEED THR OLICHe—POOR COPYVv
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—39—
In the case of In re Opinion of the Justices, 84 N. E. 499,
195 Mass. 607, the Massachusetts Senate requested an ad-
visory opinion upon a tax exemption act which was as fol-
lows:
“To exempt from all other taxation, slate and local,
the classes of intangible personal property hereinafter
enumerated and to impose thereon either as a property
tax, duty, or excise, a uniform tax at the rate of 3 mills
in each dollar of the cash valuation thereof: viz
1. Money on hand, on deposit, or at interest, and other
debts due the taxpayer;
2. Public bonds or securities;
3. The bonds of domestic and foreign corporations;
4. The shares in the capital stock of foreign corpora-
tions now taxable under the provisions of Chapter 12
of the Revised Laws.”
The Massachusetts Court in its opinion discussed the
Massachusetts constitutional empowerment of the state to
“impose and levy proportional and reasonable assessments,
rates and taxes upon all the inhabitants of and persons resi-
dent and estates lying within the said commonwealth.
While such a “proportionate” limitation is not involved
under the Iowa Constitution, the consideration of that re-
quirement, as here bearing on the substantial federal ques-
tion of uniformity, is pertinent and enlightening. At page
501 of the Northeastern citation that Court said:
“The general purpose of the constitutional provision
above quoted is to put the burdens of government
equally upon all the people, in proportion to their
ability to bear them. The Legislature has always had
this in view. It is obviously impossible to devise any
system of taxation that will be. absolutely proportional
in its operation upon individuals. The best that the
Legislature can do is to approximate closely to the re-
a
oe
sult desired, and to avoid every method which has q
direct tendency to produce unreasonable or dispropor-
tional taxation.”
It is earnestly submitted that a general school fund tax
or general school fund tax exemption cannot be uniform
in operation which does not provide that all should pay the
proportional tax which the Legislature has found their
classification should bear. That tax cannot be uniform
which allows one select group to pay at a standard and ar-
bitrary rate while all other groups must pay according to
the rate found to be necessary in raising the general funds,
The ceiling tar rate upon agricultural landowners without
a limit on other property owners is more than a legislative
finding that the former group receives less benefit. It is
an arbitrary finding that the benefit of educational taxes
to agricultural landowners cannot exceed an arbitrary
figure. Even if it is conceded that agricultural landowners
receive less benefit from school taxes, the benefit they re-
ceive must bear some relation to the benefiis received by
non-agricultural landowners. There is no such relation
contemplated in the present case. There is no more relation
between the fifteen mill ceiling regardless of the actual dis-
trict tax than there would be if the agricultural landowner
were to be completely exempted. To approve such a method
of taxation is to remove the bulwark of uniform operation
from the protection of the taxpaying public. If the Legisla-
ture can exempt to any degree a minority group from the
payment of a general tax in tax legislation which bears no
relalion to the total tax to be assessed or to the benefits de-
rived thereunder, it can exempt totally, and to degrees
which cannot possibly be said to be in the public interest
and in violation of all requisites of uniformity. Surely to
this degree the term “uniformily” requires a tax propor-
tional to the total cost to be borne by the district.
BLEED THR OLICHe—POOR COPY
—
i
The classification is arbitrary and unreasonable and
not in furtherance of any public purpose.
The federal question involved in this proposition is sub-
stantial in character.
PROPOSITION F.
The lowa Supreme Court erred in holding and deciding
that said state statute, which exempts certain citizens and
taxpayers from paying general school taxes upon real
estate of the type and kind embraced by said statute, pro-
vides a proper basis of tar exemption on the ground that
it is an encouragement and in aid of agriculture or to en-
courage the reorganization of school districts within the
state, and therefore based upon a valid public purpose and
public policy which would justify such a classification and
non-uniform operation of said statute in granting to certain
taxpayers and citizens rights and privileges not equally
granted to all citizens and taxpayers in contravention to
Section 1 of the Fourteenth Amendment to the Constitution
of the United States.
1. The purpose of the statute is private.
AUTHORITIES.
Cooley on Taxation, Fourth Edition, Section 179
and 182.
Dodge v. Mission Township, 107 Fed. 827.
Hanson v. Vernon, 27 la. 32.
In re Opinion of the Judges (S. D. 1932) 240 N. W.
600.
Keefner v. Porter, 228 Ia. 844, 293 N. W. 501.
Laughlin v. City of Portland, 111 Maine 486, 90 Atl.
318.
= .
Love v. City of Des Moines, 210 Ia. 90, 230 N. W.
373.
Lowell v. Boston, 111 Mass. 454.
_ Savings and Loan Assn. v. Topeka, 20 Wall. 655,
22 L. Ed. 455.
St. Louis & S. F. R. R. Co. v. Delk, 158 Fed. 931.
Stanley v. Jeffries, (Mont.) 284 Pac. 134.
State v. Dawson, (Wisc.) 280 N. W. 698, 709.
State v. Williams, 43 Nev. 290, 185 Pac. 459.
Thompson v. Consolidated Gas Utilities Corp., 300
U. S. 55, 79, 57 S. Ct. 364, 81 L. Ed. 510, 523.
U. S. v. Dexter, (la.) 154 Fed. 890.
William Deering & Co. v. Peterson, 75 Minn. 118, 77
N. W. 568.
2. The statute does not encourage or aid agriculture.
3. The statute does not aid education or encourage the
reorganization of schools.
ARGUMENT.
The statute provides for the assessment and levy of
general school taxes in the future, the same as in the past,
and provides in effect, that the state shall pay the general
school tax levied above fifteen mills on certain agricultural
land located in certain school districts thereby shifting the
burden of paying their general school tax from the favored
landowners to the general taxpayers of the state. The stat-
ute does not in any way encourage or aid agriculture.
Agriculture is defined in Volume 3, Words and Phrases,
Perm. Ed. 46, as the art of science of cultivating the ground,
including the planting of seed, harvesting of crops, and the
raising, feeding and management of livestock and poultry.
When we speak of a law in aid or improvement of agricul-
ture we mean a law for the betterment of this science or
art of cultivation and livestock raising; a law that benefits
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the so called basic industry, as an industry. According to
the record (Appellant-plaintiff's Exhibit “4"), the statute
would have effect in less than one-half of the school dis-
tricts in the state. How is the agricultural industry, as an
industry, improved by a law that grants public funds in the
form of a tax exemption in aid of some owners of agricul-
tural land and not to others? This kind of relief from a
general school tax burden is certainly not the kind of aid
to agriculture that is part of the public policy of the State
of Iowa. The aid to agriculture that is part of the public
policy of lowa means something that is designed to aid the
productive capacity of those engaged in the industry. It
does not mean mere income betterment by direct grant of
public funds to owners of certain agricultural lands, in
the form of a tax exemption from the payment of a general
tax. A reading of the statute will disclose that it has nothing
to do with aiding or encouraging agriculture. In the first
place the majority of the people in lowa engaged in the
farming industry are not owners of farm real estate but are
tenant farmers. A recent report compiled by the lowa
State Secretary of Agriculture shows that 51% of the per-
sons engaged in the farming industry in Iowa are tenant
farmers. In what way can they benefit from a statute that
provides for the payment of certain agricultural landowners’
taxes? In what way do the owners of thousands of acres
of Iowa agricultural land whose land happens to be sur-
veyed into tracts of ten acres or less, benefit from the
statute? In what way is the farming industry aided or en-
couraged by a statute which provides that those agricultural
landowners living in a school district which spends the
most shall receive the most benefits?
Any incidental benefit accruing to the general public
by reason of income betterment of certain agricultural
landowners is entirely offset by the increased tax burden
the public must pay in order to give certain agricultural
aio
landowners the tax exemption that results in their in-
creased income.
The cases cited by appellees in their brief and argu-
ment upholding statutes designed to aid the agricultural
industry are not in point. The statutes that are involved
in the cases cited are designed to aid or better the science
or industry of agriculture and do not provide for a tax
exemption from a general school tax for a certain favored
group of owners of agricultural land, such as the statute
involved in the case at bar.
A simple reading of the statute shows that the statute
does not in any way aid education or the reorganization
of school districts. The school districts receive no increase
in funds by reason of the appropriation involved in the
statute. They will receive no decrease in funds if the
law is held unconstitutional.
It must be borne in mind that this statute is not an
emergency relief measure. It appropriates five million
dollars annually. It establishes a permanent policy.
As stated by the Court in the case of Smithberger v.
Banning, (Nebr.) 262 N. W. 492, 501, the taxing of all the
people of the entire state, and expending the proceeds only
in certain school districts is not a public purpose. Classi-
fication must reasonably be adopted to secure a legitimate
public interest.
Indirect and incidental benefits which may result to
the public do not constitute a public purpose where the
direct object is private. The appropriation here made as
stated in the title to the act is an appropriation to pay the
“tax credits” allowed by the act and is in no sense an
appropriation made for the benefit of agriculture as an
industry or in aid of education or the reorganization of
school districts, the purpose of the statute is clearly private
and is in contravention of Section 1 of the Fourteenth
Amendment to the Constitution of the United States.
Leen THE C1ICUC DOOR CODpY
-
—15—
The federal question involved in this proposition is
clearly substantial in character.
PROPOSITION G.
The lowa Supreme Court erred in holding and deciding
that the said state statute which appropriates public moneys
raised from state-wide general sources of taxation, to the
payment, by a “credit” system, of taxes of certain taxpayers
and citizens owning real estate of the type and kind em-
braced by said statule, lo an extent arbitrarily determined
to be the amount that the tax levied for the general school
fund exceeds the amount of tax which would be levied on
the respective tracts of land if the levy for the general
school fund were fifteen mills, is a proper method of ap-
propriating state funds and that it does not deprive certain
citizens and taxpayers of property without due process of
law, and does not grant to certain taxpayers and citizens
rights and privileges not equally granted to all citizens and
taxpayers, in contravention of Section 1 of the Fourteenth
Amendment to the Constitution of the United States.
AUTHORITIES.
Blaine County Inv. Co. v. Gallet, (Idaho) 204 Pac.
1066, 1067.
Goodlove v. Logan, 217 la. 98, 251 N. W. 39.
Peabody v. Russell, 302 Il. 111, 134 N. E. 150, 20
A. L. R. 972.
People v. Brady, 277 Il. 124, 115 N. E. 204.
Smithberger v. Banning, 129 Nebr. 651, 262 N. W.
492, 100 A. L. R. 686.
State v. Fowler, 94 Fla. 752, 114 So. 435.
State ex rel Davis v. Eggers, (Nev.) 91 Pac. 819, 824.
Wilson v. School Dist., (Pa.) 195 A. 90, 113 A. L. R.
1401.
aan
—
Winter v. Barrett, 352 Ill. 441, 186 N. E. 113, a9
A. L. R. 1398.
Yick Wo v. Hopkins, 118 U. S. 356, 6 S. Ct. 1064,
30 L. Ed. 220 at 225.
ARGUMENT.
The statute is unconstitutional and void for the reason
that the same is in violation of the provisions of Section 1
of the Fourteenth Amendment to the Constitution of the
United States in that the means by which the Legislature
has provided for the determination of which districts shall
receive the benefits of the appropriation of funds raised
by taxation of the general public, and the lack of legislative
control under the statute as to the amount which each dis-
trict may command to its disposal, by the sole use of its
estimate and judgment as to the sum of money needed for
the general school fund as the criterion for the amount
of land tax credit to be received by the landowners under
the statute, is an unconstitutional delegation to the school
board of the district of the legislative power of determining
the extent and allocation of said tax money.
An attack such as is here made upon the delegation of
the legislative power to appropriate state funds under the
statute in question can only be met by the argument that
the discretion of fixing the local tax rate of the individual
district by the school board is, as to state appropriations,
only the exercise of a ministerial and not a legislative
power by the board.
But the duly elected representatives of a local subdivi-
sion of a stale are not the duly elected representatives of
the people of an entire state. And such local representatives
cannot have the power to control the amount and alloca-
tion of the public moneys of an entire state. Hence, the
only question before the lowa Court as to this aspect of
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a
the case is to determine whether or not the fixation of the
benefit and the extent thereof, to be received by a local
district, by its local officers of general funds raised from
the public of an entire state, is a legislative or a ministerial
function.
The argument is anticipated that such a delegation «f
power to local authorities to determine its own eligibility
for benefit from state funds is not without standards pre-
scribed by the Legislature, and that such delegation is hence
a lawful direction of ministerial duties performed under
legislatively created standards and is not a relinquishment
by the General Assembly of legislative power. Any merit
to this contention can only be advanced to the phase of the
statute defining the landowners, or lands entitled to cover-
age thereunder. This is admittedly fairly definite and
complete and perhaps adequately directs the county offi-
cers in determining which landowners shall be entitled to
exemption, and to a consequent gift in the payment of his
taxes. But as this Court knows, and as the authorities de-
cisively show, the test of propriety of “delegation” legisia-
tion is the completeness of such statutes as to all the stand-
ards by which the activity of the delegatee body shall be
governed in a given situation. As has been previously
noted, the only limit upon the amount of tax, and hence
the related amount of benefit a local rural district can
claim for itself and for the agricultural landowners therein
is the tax limit per student imposed by another section of
the Code entirely unrelated and unmentioned by the stat-
ute itself. Thus, the phase of the statute relating to the set-
ting of the amount of school expense for the district, and
hence, the school tax which shall be levied upon its land-
owners is left, except as to that upper limit of tax per stu-
dent, entirely to the discretion of the local taxing district.
The local millage rate is totally dependent upon local dis-
cretion. While this legislative tax discretion may not be
mis
onerous when only local moneys and local taxpayers are
concerned, it is onerous and in contravention of the Four-
teenth Amendment when that local discretion is allowed to
operate upon state tax funds raised from state-wide general
taxes and paid by taxpayers of the state who owe and are
under no public obligation to pay the taxes of a foreign
locality, unless their Legislature so directs for a valid pub-
lic purpose. It is onerous when local discretion can dictate
the disposition of such state funds and can effect their allo-
cation without a legislative decree as to such allocation
and a legislative setting of the amount so to be allocated.
The general taxpayers of the State are constitutionally
entitled to have their Legislature direct where such money
shall be spent. The general tarpayers of the State are Con-
stitutionally protected from an unlawful act which in its
“appropriation feature” lays out a gift of $500,000, then
$2,000,000 and now $5,000,000, and allows any or all, or
some or none, of the school districts as the districts them-
selves choose, to partake at will and in any amount or pro-
portion they desire until the public bounty is exhausted.
The general taxpayers of the State are entitled to have each
State appropriation to any locality in the State subject to
the combined consideration and wisdom of their duly elect-
ed Legislators. Certainly the general taxpayers of the state
and the non-benefiting landowners in the locality are en-
titled to more than a lethargic legislative assumplion that
the local school board officers will make a reasonable esti-
mate, and that they possibly may not cause the local tar to
be hiked to allow the district and benefited landowners to
climb upon the gravy train of uncontrolled state aid.
Whether such local state aid to a class which is not desti-
tute, or infirm, or without means of support, could consti-
tutionally be accomplished by the Legislature's appropriat-
ing funds in designated amounts to certain districts after
a consideration of which district it deemed in the general
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ee:
public interest to aid need not here be considered. Neither
need it be contemplated whether or not a gift to all school
districts in designated and equal amounts would meet
the constitutional requisites of uniformity and legislative
exercise of its vested power of appropriation of State funds.
The statute itself shows that no particular district or dis-
tricts are considered as objects of legislative bounty and
that no legislative consideration has been or can be given
to which if any agricultural land-owners are paying an ex-
cessive tar, and what, if any, state aid should properly be
granted to any district. All this determination as to dispo-
sition of state funds raised by state-wide general taxation
is decided by each individual school board or taxing dis-
trict. Whether a great or a small amount of the total ap-
propriation is received locally, its amount and allocation
is neither the result of a legislative directive nor the result
of the operation of the statute by the local board’s follow-
ing any requisites and standards set forth by the Legisla-
ture as to how much benefit it and its agricultural land-
owners may receive.
That this local discretion as to millage rate cannot be
made the basis of determination of what, if any, share of a
total state appropriation shall be received locally and that
the Fourteenth Amendment of the Federal Constitution is
amply sustained by the authorities.
The rule as to delegation of legislative power is as stated
by this Court in the case of Yick Wo v. Hopkins, 118 U. S.
356, 6 S. Ct. 1064, 30 L. Ed. 220 at page 225 of the L. Ed cita-
tion:
“There is nothing in the ordinances which points to
such a regulation of the business of keeping and con-
ducting laundries. They seem intended to confer, and
actually do confer, not a discretion to be exercised
upon a consideration of the circumstances of each case,
but a naked and arbitrary power to give or withhold
niles:
consent, not only as to places, but as to persons. So
that, if an applicant for such consent, being in every
way a competent and qualified person, and having com-
plied with every reasonable condition demanded by
any public interest, should, failing to obtain the requi-
site consent of the supervisors to the prosecution of
his business, apply for redress by the judicial process
of mandamus to require the supervisors to consider and
act upon his case, it would be a suflicient answer for
them to say that the law had conferred upon them auth-
ority to withhold their assent, without reason and with-
out responsibility. The power given to them is not
confided to their discretion in the legal sense of that
term, but is granted to their mere will. It is purely
arbitrary, and acknowledges neither guidance nor re.
straint.”
In the case of State ex rel Davis v. Eggers (Nev.) 91 Pac,
819 at page 824 the Nevada Court states as follows:
“As all appropriations must be within the legislative
will, it is essential to have the amount of the appropria-
tion, or the maximum sum from which the expenses
could be paid, stated. This legislative power cannot
be delegated nor left to the recipient to command from
the state treasury sums to any unlimited amount for
which he might file claims.”
The rule as to delegation of legislative power immedi-
ately brings to mind the case of Goodlove vp. Logan, 217 Ia.
98, 251 N. W. 39, in which the Court stated at page 40 of
the Northwestern citation, that the question before it was:
“Whether or not the Legislature of the State of Iowa
had a right to confer upon the highway commission the
power and authority to pass and establish rules and
regulations. * * *”
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—
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At page 43 of the Northwestern citation the Court said:
“* * * If the Legislature can delegate to the highway
commission the right to do these things, then, of course,
the Legislature can delegate the same power to the
board of control, superintendent of banking, and all
other administrative departments of the state may like-
wise be empowered to enact rules and regulations to be
given the force of statute, which said commission might
in their judgment determine to be for the general pro-
tection of the public. Once this bureaucracy has fas-
tened itself into the life of legislative power, little else
need be done by the Legislature than to meet and create
boards. The Legislature has no such right to delegate
to the highway commission legislative power to pass
rules and regulations concerning the use of the primary
highways of this state by the people of this state, such
Rule VII. If the Legislature in its wise judgment de-
sires to pass such a statute, it, of course, has the right
and authority to do so, for the Legislature is composed
of the representatives of the people; it is chosen by the
people for the purpose of making the laws of this state.
The Legislature cannot transfer the power of making
laws to any one else, or place the right to make laws
anywhere but where the people have placed it. * * *”
In holding such delegation unconstitutional as “legisla-
tive” the Court quotes with approval from the case of State
pv. Fowler, 94 Fla. 752, 114 So. 435, 437:
“It may be stated that the paramount test as to whether
or not a particular statute amounts to an invalid dele-
gation of legislative power is the degree of complete-
ness of the statute as it appears when it leaves the
hands of the legislative body. This law must be so com-
plete in all its terms that nothing is left to the judgment
of the delegate or appointee of the Legislature, and,
where a statute passed by the Legislature is not com-
plete as legislation, but authorizes an executive board
or some other named authority to decide what should
and what should not be deemed infringement of the
—
law, it must be held unconstitutional as attempting to
make an improper delegation of legislative power.”
In the case of Winter v. Barrett, 352, Il. 441, 186 N. E,
113, the Supreme Court of Illinois found it necessary to con-
demn appropriation legislation because it found that the
statute attempted to give to the “emergency relief commis.
sion” the power to determine what portion if any of a fund
allotted to any particular county over 500,000 in population
should be allocated to relief and what portion should be al-
located to “education purposes”; and in any county having
a population under 500,000 the power was attempted to be
given to the county board to determine what portion, if any,
of the fund should be allotted to the superintendent of
schools for “educational purposes” and what portion should
be expended for “relief purposes.” The Court at page 127
of the Northeastern citation states:
“* * * It is apparent that the Legislature has not in
either of these appropriations appropriated a distinct
and separate amount for each of these two purposes,
but has appropriated for both or either of the two pur-
poses in one amount. This is in violation of the consti-
tutional requirement that bills making appropriations
must specify the objects and purposes for which the
appropriations are made and appropriate to such ob-
jects and purposes their several amounts in distinct
items and sections.” (Italics Supplied)
The Court at page 128 of the Northeastern citation furth-
er stated:
“* * * These provisions of section 4 are unconstitu-
tional and void, because no money may be drawn from
the state treasury except in pursuance of an appropria-
tion made by law, and no appropriation may be made
subject to the discretion of any person or board or com-
mission as to the purpose or object for which it may be
used.” (Italics Supplied)
_—e ew. oo ole Oe) ee ae
—
—5s—
As in the present case, the discretion of a board was in-
tended to supply the variable omitted by the Legislature as
to the amount of state funds to be received for “educational
purposes.” And where that discretion was nol tempered
with a complete set of standards and guides for compula-
tion of that amount, the court was constitutionally bound
to condemn the appropriation.
The function of determining the amount of a tax when
no standards exist controlling the computation thereof is
clearly “legislative.” The school board which performs this
function does so as a creature of the Legislature, a quasi-
corporate body, endowed with such power by the Legisla-
ture. The propriety of such determination for the purpose
of fixing local taxes is not directly questioned. The objec-
tionable feature of the statute in question is that the exer-
cise of this discretion is made the basis or controlling state
and not local funds. Beyond the appropriation to the gen-
eral fund, the Legislature cannot under the statute control
the disposition of that fund. It is controlled by the school
board themselves. There is no standard provided by which
the school boards may be guided or controlled in command-
ing only a certain amount, or proportional amount, or an
amount equal to other school districts’ benefits. The single
limit of a maximum tax per student leaves the board with a
tremendous range of discretion as to the control of a slice
of unknown size of the total appropriation.
When confronted by a situation similar to the present
case in which the Legislature had appropriated $4,000,000
for “work, relief, direct relief, old age assistance, assistance
to dependent mothers and children, public health or related
matters of security and welfare, and public works, especially
roads by the use of work relief labor,” to be expended by a
legislatively created “state assistance committee” in con-
templation of a Federal Relief Program, the Nebraska Su-
preme Court in the case of Smithberger v. Banning, 129
a
ji
Neb. 651, 262 N. W. 492, found that this power or discretion
in the committee was the delegation of a legislative power
of appropriation and hence was in contravention of the
Fourteenth Amendment. The Court at page 495 of the
Northwestern citation stated:
“* * * There is no provision in any of the bills men.
tioned that fixes any standards for the guidance of the
state assistance committee or the board of educational
lands and funds. The committee and board above men-
tioned have an arbitrary and unrestricted discretion to
allocate the $4,000,000 to any of the purposes set forth
in the acts under consideration, with the single excep-
tion that old age pensions are to be given a preference,
Under these acts, the board and committee have the
power, if they see fit to do so, to allocate the whole fund
to the payment of old age pensions and unemployment
insurance without the requirement of the making of any
findings of fact under standards and tests provided
for in the act. Such provisions amount to a delegation
of legislative power. Under Section 1, art. 2, and Sec-
tion 1, art. 3, of the Nebraska Constitution, the legisla-
tive power of the state is vested in the Legislature and
cannot be lawfully delegated to any board or committee.
Such provisions deny the equal protection of the law
and violate the due process provisions of the Fourteenth
Amendment to the Federal Constitution.” (Italics Sup-
plied)
It is apparent that the Legislature in the present statute
has gone beyond constitutional bounds. There is no stand-
ard to which the school district need conform to meet the
requirements of the statute. The Legislature cannot con-
trol any district's inclination to abuse this privilege. More-
over, in school districts where the voting majority is made
up of agricultural landowners, there is little likelihood that
such abuse will be received with displeasure by the district
electorate. This is the situation which the Legislature has
intentionally or inadvertently created to the jeopardy of
nroIecenm Wh wi eu _ ene fe eee
=
hh
(1) the general taxpayers of the State, and (2) the taxpaying
owners of non-benefiting agricultural and urban lands in
the district in which such abuse is effected. This statute
js in contravention of the provisions of Section 1 of the
Fourteenth Amendment to the Constitution of the United
States.
The federal question involved in this proposition is sub-
stantial in character.
PROPOSITION H.
The lowa Supreme Court erred in holding and deciding
that said state statute which appropriates public moneys
raised from state-wide general sources of taxation, to the
payment, by a “credit” system, of individual taxes of cer-
tain taxpayers and citizens owning real estate of the type
and kind embraced by the statute, without any limit to the
amount of such benefit which an individual taxpayer may
receive, and which credit is arbitrarily determined to be
the amount that the tax levied for the general school fund
on each tract of such lands owned by him exceeds the
amount of tax which would be levied thereon if the levy
for the general school fund were fifteen mills, is a proper
method of appropriating state funds for a valid primary
public purpose and that the classification employed therein
does not deprive certain citizens and taxpayers of property
without due process of law and does not grant to certain
taxpayers and citizens rights and privileges not equally
granted to all citizens and taxpayers, in contravention of
Section 1 of the Fourteenth Amendment to the Constitution
of the United States.
a,
AUTHORITIES.
Panama Refining Co. v. Ryan, 293 U. S. 388, 55 Ss.
Ct. 241, 79 L. Ed. 446.
Peabody v. Russell, 302 Ul. 111, 134 N. E. 150,
Schechter Poultry Corp. v. United States, 295 U. §.
495, 55 S. Ct. 837, 79 L. Ed. 1570.
Smithberger v. Banning, (Nebr.) 262 N. W. 492.
Winter v. Barrett, 352, Il. 441, 186 N. E. 113.
Yick Wo v. Hopkins, 118 U. S. 356, 6 S. Ct. 1064, 30
L. Ed. 220.
ARGUMENT.
The non-uniformity of operation of the statute and its
lack of a public purpose is further increased by the fact
that there is no appropriation by the Legislature to any
particular needy school district, or any provision limiting
the amount of financial benefit which any one district may
receive. Rather, the school board of the individual district
has been granted under the statute the sole power to dic-
tate to the Legislature the amount of benefit the landown-
ers of the district shall receive. The only curb upon the
outgoing or treasury end of this legislatively created pork
barrel is that the apportionment of public funds to all the
school districts receiving land tax credits cannot exceed
the total amount of money appropriated. And the subse-
quent amendatory acts of the Legislature to increase this
fund show that no limit is in sight to the size to which it
may grow. Beyond the knowledge of the total amount of
the appropriation and the approximate amount of “agri-
cultural lands” to be created under the statute, the Legisla-
ture neither knows where, nor is able to control the
amount or the allocation of the funds to the various dis-
tricts.
—_— =
That such a method of appropriation of state funds by
the Legislature, in effect allowing the district itself to de-
termine how much public aid it shall receive, must needs
result in a non-uniform operation is amply evident from a
contrast between the means of apportioning the appropria-
tion to school districts employed under this statute and that
method provided by the Legislature in the case of Winter v.
Barrett, 352 Il. 441, 186 N. E. 113. Although constitutionally
condemned for tie reason that local legislative discretion
was entailed in apportioning the amount received, by the
district, the legislation there concerned provided for a sys-
tem of disbursement to the various districts of the total ap-
propriation which left to the bodies administering the “allo-
cation feature” of the statute only minis:erial duties. That
system of disbursement was based totally upon a mathe-
matical calculation using the last United States census
figures as to district population. Such calculation was ob-
viously mechanical and ministerial and further, would
mathematically tend toward a uniform and proportional
allocation of the total appropriation throughout the state.
No local discretion factor entered into the computation, and
no “legislative” function was entailed.
In discussing those cases in which no such mechanical
computation according to legislatively set standards was in-
volved, and where the provision for allocation was based
solely upon an administrative officer's performing a “legis-
lative function” the Illinois Court in condemning an appro-
priation act to be administratively allocated through state
branches of government in the case of Peabody v. Russell,
302 Ill. 111, 134 N. E. 150, at page 154 of the Northeastern
citation stated as follows:
“In our judgment, if this appropriation for the benefit
of either one, two, or three departments of the state
government, without specifying the definite purpose or
object of the appropriation can be sustained, then such
—
appropriations for every branch of the state govern.
ment, just as indefinite must be sustained, and we see
no legal reason why, if $500,000 could be thus appro-
priated, even larger sums might not be appropriated
to various state departments in the same indefinite and
uncertain manner. * * *” (Italics supplied.)
It is not questioned that the Legislature may, and per-
haps should, appropriate public moneys in aid of school
districts which have adequate facilities or, because of local
problems have inordinately high expenses. But surely the
Legislature cannot grant to the individual school district
the power to determine whether it shall and to what extent
it is to receive a state appropriation. The power to appro-
priate is vested solely in the Legislature, and the means of
granting such aid must conform to the legal procedure pro-
vided by the constitution for such appropriations. To al-
low such a delegation of power by the Legislature is to
place the landowners of that school district which attempts
to run its school affairs in a sane and economical manner
at the complete mercy of those school districts which choose
to exploit the “appropriation feature” of the statute to the
fullest extent allowed by law. The tax dollars such a district
provides to the general fund by general taxation will flow
to high expense districts, not by legislative decree, but by
the direction of the school board which has raised its esti«
mate or has already a high rate of school expense, There
is no curb for equal expenditures upon school districts
which have identical problems. The Legislature and the
general public are laid wide open to such onslaughts as the
exploiting school district chooses to make. The Legislature
under the statute has divested itself of the power to govern
where such appropriation shall be allocated, and any pro-
tection of the public as to the wisdom of the expenditure of
its funds in a uniform and proper manner has been sacri-
HLEED THROU GH-—POOR COPY
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—5jo—
ficed and left to the individual judgment of the board of
each individual school district.
To allow the district itself to determine its individual
need of state funds raised from general and state-wide
sources based (1) on the number of agricultural lands
qualifying under the statute and (2) the expense the dis-
trict may arbitrarily decide the coming year will entail, is
to foment class legislation and arbitrary discrimination
of the most local and vicious sort. The district and not the
Legislature determines the class of burden to be borne or
benefit to be received from the appropriated funds. The
district and not the Legislature determines the amount of
public money which shall be appropriated to its local
needs. The district and not the Legislature determines that
the public welfare of the state will be served by the expendi-
tures it makes of public moneys in its own locality. Surely
it cannot be contended that the end result of such a means
of determining the disposition of state funds will have as
its end result just and uniform operation and a publicly
beneficial purpose.
The arbitrary nature and the resultant non-uniform op-
eration of the statute cannot be justified or explained by
either theory of the “appropriation feature” of this statute.
Whether it is said that the agricultural landowner receives
the direct benefit of the appropriation to the district, or
whether the appropriation is called a bookkeeping trick
transferring public moneys from one state “pocket” into
another, the appropriation does not and cannot operate in
a uniform or substantially uniform manner upon all the
school districts of the state, nor does it operate upon those
districts which the Legislature has decided it is in the pub-
lic interest to aid, It does not operate equally upon agricul-
tural landowners throughout the state although they are
covered by the statute, nor does it help any particular agri-
cultural landowners which the legislature has decided it
ay
—6o—
is in the public interest to aid, even if such an arbitrary
selection were constitutionally permissible. Nor, if the en-
tire public interest requires that certain districts be aided
to a greater extent than other districts, is the public al-
lowed to have its Legislature determine which districts
shall receive the benefit of state aid. The local school board
determines the extent of its need and the amount of the
state appropriation it shall command. If is one thing for
the school board to determine what the rate of local school
taxes shall be. It is another for the school board to dictate
its share of a public fund to be used for local purposes, and
to declare that because the millage rate required for school
purposes is over fifteen mills and there are agricultural
landowners in the district it is in the public interest of the
state and for a state public purpose to allot to that district
@ part of an appropriation of funds raised by general tax-
ation.
To say nothing of the plight of a taxpayer who receives
no benefit under the statute because she does not own agri-
cultural land of the type and kind concerned by the statute,
but resides in a district where the school board has hiked
the estimate of required school expenditures to receive
state appropriations in the form of “land Tax Credits”, and
whose taxes skyrocket with the estimate, the result of a
private benefit to the agricultural landowners therein is
inevitable, and the secondary benefit, if any, to the general
public of the state by increased educational facilities in
that arbitrarily and non-legislatively designated district
would rest on chance and happenstance. But under this
statute, the public purpose rests distinctly upon a fictitious
legislative finding that the public will benefit by a gratuity
to an individual or to a school district to which no public
obligation runs, or that the public will generally benefit by
an appropriation gratuity to a locality which selects itself
as the proper beneficiary. It would be supposed that the
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Legislature should have in mind which, if any, local dis-
tricts should receive the public bounty for the purpose of
ascertaining the need and existence of a public purpose and
public benefit to the State in granting local aid. But the
Legislature does not know, and cannot know, which, if any,
or all localities will receive the benefit of public gratuity
until the requisition for public funds on the basis of “Land
Tax Credits” and the tax figure estimated by the school
board are set. The school board and not the Legislature
will have determined that it was in the public interest that
money be allocated to a prescribed extent to aid in that
particular district. Uniformity under such a haphazard and
foresighted method of local appropriation, and the service
of a public interest and purpose is impossible.
This aspect of non-uniformity of operation also presents
the distinguishing characteristic between this statute and
such legislation as the Homestead Act or veterans’ home
benefit or pension legislation, Under the latter type of
statute the Legislature has clearly provided by definition
and outline what exactly is a homestead, or what consti-
tutes a veteran eligible to receive benefits. It has specifical-
ly limited the amount of exemption to each person claim-
ing benefit thereunder, in the Homestead Act, both in size
of the tract and in value, and in the case of Pensions the
limit and manner of computation thereof based upon uni-
form standards,
Under the statute presently considered, the Legislature
has only defined what is “Agricultural land.” It has pre-
scribed no limit to any individual landowner, nor has it
placed any limitation upon his resident status. There is
no limit upon the size of the tract of land upon which he
may claim the exemption and gratuity, nor as to the amount
of personal exemption from tax he may claim. The Home-
steader and veteran must be locally present and meet
other personal requisites to receive a limited personal bene-
= SS
fit of exemption. The agricultural landowner need not be
a local resident, or hold any other local status to receive
not only the exemption, but the actual gratuity of a land tax
credit to the unlimited extent of his agricultural landhold-
ings.
Further, the homestead exemption to agricultural or
urban land is uniform throughout the State. Whether a
man’s homestead borders on the Missouri or the Mississippi
he receives equal benefit under the law. The veteran re-
ceives no greater pension or exemption than his former
comrade in arms who saw the «ome service though one re-
sides in Council Bluffs while the other resides in Daven-
port. But under the present statute the amount of exemp-
tion and amount of gratuity rests arbitrarily upon local
necessity or school board whim. The landowner in one
district may receive a one mill exemption and gratuity on
a sixteen mill school tax, while his neighbor across the road
may receive a thirty-five mill exemption and gratuity ona
fifty mill school tax. The comparison of non-uniformity
and uniformity between the above named types of legisla-
tion speak for themselves and the unconstitutional failure
of the statute under consideration to conform to constitu-
tional requisites and discriminatory benefits based solely
upon locality, need no further elaboration.
Because of the unlawful delegation by the Legislature
to the local school district of the power to determine the
amount of benefits it receives under the statute, if any, the
statute does not operate uniformly on members of a class
and is in contravention of Section 1 of the Fourteenth
Amendment to the Constitution of the United States.
The federal question involved in this proposition is
substantial in character.
BLEED THROU GH=—POOR COPY
calle
CONCLUSION.
It is respectfully submitted that the questions presented
by the appeal in the case at bar are meritorious and of a
substantial nature warranting a review by the Supreme
Court of the United States of the decision of the Supreme
Court of the State of Iowa, which upheld the Iowa Statute
involved herein against timely challenges as to its consti-
tutionality under the Fourteenth Amendment to the Consti-
tution of the United States, and the appellees’ motion to
dismiss or affirm should be denied.
Martin M. Cooney,
Rosert W. CLEWELL,
WituiaM C, FuERsTE,
705 Roshek Building,
Dubuque, Iowa.
Counsel for Appellant.
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