Petition for Writ of Certiorari — Novato Fire Protection District v. United States
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No. 99-
Supreme Court, U.S.
FIbLeE p
991209 yan 19 2000
GEPRE O6 Hg CLERK
IN THE
Supreme Court of the United States
NOVATO FIRE PROTECTION DISTRICT,
¥.
Petitioner,
UNITED STATES OF AMERICA and
UNITED STATES COAST GUARD,
Respondents.
ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED
STATES COURT OF APPEALS FOR THE NINTH CIRCUIT
PETITION FOR A WRIT OF CERTIORARI
Of Counsel:
Gregory A. Wedner
BERGMAN & WEDNER, INC.
Suite 900
10880 Wilshire Blvd.
Los Angeles, CA 90024-4101
(310) 470-6110
George J. Silvestri, Jr.
LAW OFFICES OF GEORGE J.
SILVESTRI, JR.
250 Bel Marin Keys Blvd., #F-200
Novato, CA 94949
(415) 883-8800
January 2000
E. Edward Bruce
Counsel of Record
Robert A. Long, Jr.
Anthony J. Vlatas
COVINGTON & BURLING
1201 Pennsylvania Ave., N.W.
Washington, D.C. 20004-2401
(202) 662-6000
Counsel for Petitioner
QUESTION PRESENTED
Whether the federal government's constitutional immu-
nity from state taxation requires a local government to
provide free fire protection and emergency medical services
lo a federal facility that was “detached” (i e., deannexed)
more than 20 years ago under applicable — state
law
procedures?
(1)
TABLE OF CONTENTS
Page
QUESTIONS PRESENTED ..0.00.....ceeccccccsesscceseosecseeoeeoceccc. i
BORE OF COITIEINTS nic scsicescsssncsscsssevesecoseesscoses ces... ii
TABLE OF AUTHORITIES. ....0.....ccccccccccccescoseeseoseecccccce iV
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CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED ..0.00..-occcccccccececceceee oc . 2
PEMRRMOMEINE OF PME CASE ooo cocccceccccseesccss.... 3
The Facts Giving Rise to this Case niabanlanaheadiateianiat cle e
Proceedings in the District Court ......0..000.00cccccccc 5
Proceedings in the Court I acta ale ial gaa tnt 6
REASONS FOR GRANTING THE WRIT... 7
|. The Ninth Circuit's Decision Conflicts With
Decisions Of This Court Narrowly Confining
Federal Immunity From State Taxation To Direct
Levying Of Taxes Upon The Federal Government... 8
II. The Ninth Circuit's Decision Raises A Serious
BORE OT FORO TMNGITI iscsi css ocecesevecneesesee:seccecece.-cs... 16
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(111)
IV
TABLE OF AUTHORITIES
Page(s)
Cases
Alabama v. King & Boozer, 314 U.S. 1 (1941)... Q
Arizona Department of Revenue v. Blaze Construction
Company, inc., 119 S. Ct. 957 (1999) .......c0.0s0ccceseees 11,14
Ashwander v. Tennessee Valley Authority,
etd ceenutienehnnncntiiinihaeei 7
California State Board of Equalization v.
Sierra Summit, Inc., 490 U.S. 844 (1989) oo. 13
Cotton Petroleum Corp. v. New Mexico,
Pe NE En I inca stcnlanen disp toncicsealieeaainbibenannewees 9
Curtis v. Board of Supervisors of Los Angeles County,
FE ee AT A tin tateinisbiesbekebsstioucdéngraasinineiees 6
Davis v. Michigan Department of Treasury,
a a I einen saccetieneepeedintecinsnanseiausaracevacceis 16
Department of Commerce v. United States House
of Representatives, 119 S. Ct. 765 (1999) o.oo 7
Dobbins v. The Commissioners of Erie County,
8 Ue re ie I Pov reiekece Secu seencencndahicsaakerd 8,9
First Agricultural National Bank of Berkshire County
v. State Tax Commission of Berkshire County,
FE As ey ee EE sional vasiec tives ecea lectin arkians 10
Garcia v. San Antonio Metropolitan Transit Authority,
ED Ad Se. SE wick tsvensdatdaiiiicenlelacamsrbeonsnisvendedeeiiiaes 18
Gillespie v. Oklahoma, 257 U.S. 501 (1922) 0... 8,9
Graves v. People of New York ex rel.
FP BEE, FOO Ee. I UF) sevsinsivccvevsenasviseavnveainicioan 9, 16
Gregory v. Ashcroft, 501 U.S. 452, (1991) wou. eeeeeeeeeee 16
Helvering v. Mountain Producers Corp.,
I Nees Fe HUE eich sinciahadiibivcinaeeopeniaedadanaoigiasonnsupeenanan 9
James yv. Dravo Contracting Co.,
mR Sk. sp SN eM Ucar ene Soe meats one ECS 9
Jefferson County, Alabama v. Acker,
Ee Os hs eT isn scnesasvbcinsscbenTusenicichaptidetcatuncsaas 1]
V
Levinsohn v. City of San Rafael, 40 Cal. App. 3d 656,
OES Ck RE Se re iceicccasnialas Quatre na,
Massachusetts v. United States, 435 U.S. 444 (1978)..........
Mayo v. United States, 319 U.S. 441, 447 (1943)
M'Culloch v. Maryland, 17 U.S. (4 Wheat.)
FO AEE Piinrttsincieccinniiiein ela ne 8, 10,
Michelin Tire Corp. v. Wages, 423 U.S. 276 (1976).............
New York v. United States, 505 U.S. 144 (1992)
Panhandle Oil Co. v. Mississippi ex rel. Knox,
EET Us BAIT stein 9,
Printz v. United States, 521 U.S. 898 (1997) ........00....... 16,
Simi Valley Recreation and Park District v.
Local Agency Formation Commission of
Ventura County, 51 Cal. App. 3d 648,
eee ee ee ee
eee ee
124 Cal, Rete: G55 1ST sc ccc eee
South Carolina v. Baker, 485 U.S. 505 (1988) ........0..0.... 9.
Spector Motor Services, Inc. v. McLaughlin,
FOS LS. BT CIID iisacinccsatiuisistersitadiccniacn ee ne
United States v. California, 507 U.S. 746 (1993).......... 14,
United States v. City of Columbia, Missouri.
914 F 26 13) GE, TI iiv icici eae
United States v. City of Huntington, West Virginia,
999 F.2d 71 (4th Cir. 1993) cert. denied.
DEO US. FOG CRI voscsscvintcciincsssicectetebastenntet ene
United States v. County of Fresno, 429 U.S. 452 (1977) foe
United States v. New Mexico,
SIF UD. Tale CAPES visiicermeceiencieeeinias o, 0 bay oo
United States v. La Franca, 282 U.S. 568 (1931) .....0..0000--..
United States v. State Tax Commission of the State
of Mississippi, 421 U.S. 599 (1975) woe ceccecescescesceseee,
Washington v. United States, 460 U.S. 536 (1983)......... 11,
Vl
Constitutional and Statutory Provisions
Che Se } PN rE in eee eS 2
CS oe. SRI: IE BE iiss istecticscocccenucacescantnu eee 2
LS UB. & ZA Ue seskecicscethcctischecsiein eee 14
bS CFA. BER PNT) vicecicscsidicushieonscnelanbectuaanlathanamaieaens 14
28 U.S.C. § 1254(1) cia ida daioenisted bai daetneiaabeneeseiel ae 2
45 Comp. Gen. 1, 1965 WL. 1676 (19G5)....:..ccccsesssessssenesees 16
Cal. Civ. Proc. Code § 349.1 (West 1999)...............ccssessoascsess 4
California Code of Civil Procedure § 349.1 (West 1999)...... 2
Miscellaneous
EU POGRIMTE POR ES cscsssiscksisiccotccecsaayc tee ee 17
TO FIRE TD. OP ecwexcssactevsxakccscnsacitecnt cee 17
IN THE
Supreme Court of the United States
No. 99-
NOVATO FIRE PROTECTION DISTRICT.
Petitioner,
V.
UNITED STATES OF AMERICA and
UNITED STATES COAST GUARD,
Respondents.
ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED
STATES COURT OF APPEALS FOR THE NINTH CIRCUIT
PETITION FOR A WRIT OF CERTIORARI
The Novato Fire Protection District (“NFPD”)
respectfully petitions this Court for a writ of certiorari to
review the judgment of the United States Court of Appeals
for the Ninth Circuit in this case.
OPINIONS BELOW
The opinion of the court of appeals (App.. infra, 1a-12a)
is reported at 181 F.3d 1135. The opinion of the district
court (App., infra, 13a-22a) is unreported.
(1)
2
JURISDICTION
The judgment of the court of appeals was entered on
July 7, 1999. A petition for rehearing was denied without
opinion on September 21, 1999. App., infra, 23a. On
December 6, 1999, Justice O’Connor extended the time for
filing a petition for a writ of certiorari to and including
January 20, 2000. This Court’s jurisdiction rests on 28
U.S.C. § 1254(1) (1999).
CONSTITUTIONAL AND STATUTORY
PROVISIONS INVOLVED
The Supremacy Clause of the U.S. Constitution provides:
This Constitution, and the Laws of the United
States which shall be made in pursuance thereof; and
all Treaties made, or which shall be made, under the
Authority of the United States, shall be the supreme
Law of the Land; and the Judges in every State shall
be bound thereby, any Thing in the Constitution or
Laws of any State to the Contrary notwithstanding.
U.S. Const. art. VI, cl.2.
The Tenth Amendment to the U.S. Constitution provides:
The powers not delegated to the United States by
the Constitution, nor prohibited by it to the States, are
reserved to the States respectively, or to the people.
U.S. Const. amend. X.
California Code of Civil Procedure § 349.1 (West 1999)
provides:
The validity of any acts or proceedings taken
under color of law for the formation, organization,
incorporation, dissolution, consolidation, change of
organization or reorganization of, or for any change
in the territorial boundaries of, any city, county, city
and county, special district, public corporation or
3
other public entity, or improvement district within
any of the foregoing, shall not be contested in any
action unless such action shall have been brought
within six months from the date of completion of said
acts or proceedings. Unless an action is commenced
within said period all said acts or proceedings shall be
held valid and in every respect legal and
incontestable.
STATEMENT OF THE CASE
The Facts Giving Rise to this Case
The Novato Fire Protection District (“NFPD”) is a local
government agency that provides fire protection and
emergency medical services to parts of Marin County,
California. In the 1930s, the federal government acquired a
large tract of land—commonly known as Hamilton Field—
located within the boundaries of the NFPD. The federal
government operated Hamilton Air Force Base on the land
until 1974. From the time the Air Force Base was built until
it was decommissioned in 1974, the federal government
provided its own primary fire protection at Hamilton Field.
App., infra, 2a. 13a.
When the U.S. Air Force reduced its operations at
Hamilton Field in 1974, management of the facilities was
transferred to the U.S. Navy. The Navy reduced the level of
fire protection services provided by the federal government at
Hamilton Field, and entered into a contract with the NFPD to
provide primary fire protection and emergency medical
services to the federal facility. App., infra, 2a.
In 1976, the NFPD applied to the Marin County Local
Agency Formation Commission (“LAFCo”) for permission
to alter the NFPD’s geographical boundaries to exclude
Hamilton Field. This deannexation procedure is known as
“detachment” under California law. In support of its
application, the NFPD stated that requiring the NFPD to
4
provide free fire protection services to Hamilton Field would
“impose[] an intolerable burden upon the remaining property
owners in the District.” C.A. App. 25.
In February, 1977, LAFCo approved the detachment, and,
consistent with California law, called for an election to
confirm or reject the detachment. Following the submissiop
of written objections from the Navy and the Air Force and a
public hearing, voters approved the detachment by a vote of
3,949 to 943. In January 1978, the detachment was certified
by the California Secretary of State. App., infra, 14a.
The federal government did not challenge the detachment
within the six-month period provided by California law. See
Cal. Civ. Proc. Code § 349.1 (West 1999). To the contrary,
in early 1977 the NFPD filed an action in federal court in
connection with the federal government’s plan to remove fire
fighting personnel from Hamilton Field. Novato Fire
. Protection Dist. v. James W. Plumber, Secretary of the Air
Force, Civ. No. C-77-66-WTS (N.D. Cal.). In responding to
the NFPD’s action, the federal government represented to the
court:
If the Federal property is no longer within the
boundaries of the local district, the local district is no
longer obligated to service the Federal property. If
not obligated to provide services, the District and the
Federal agency may enter into a valid contract for
services.
C.A. App. 95-96.
For 20 years, the federal government entered into annual
contracts with NFPD to provide fire protection and
' After the detachment of Hamilton Field was completed and the
parties entered into a contract for services, Plumber was dismissed
by stipulation. C.A. App. 96
5
emergency services at Hamilton Field. The U.S. Coast
Guard, which occupied a portion of Hamilton Field, received
the benefits of these services. In 1996, however, when the
Coast Guard took over the largest portion of Hamilton Field,
it asserted that the federal government is entitled to receive
free fire and emergency protection services from the NFPD.
In support of that position, the Coast Guard argued that the
1976 detachment of Hamilton Field violated the Supremacy
Clause, because it purportedly subjected the federal
government to local taxation. App., infra, 18a.
Proceedings in the District Court
NFPD brought this action in state court seeking a
declaration that it is not obligated to provide free fire
protection and emergency medical services to Hamilton
Field. The United States removed the case to federal court.
It also filed a claim against the City of Novato, asserting that
if the NFPD is not required to provide free services to
Hamilton Field, then the City is obligated under California
law to provide such services.”
On cross-motions for summary judgment, the district
court held that the United States is not bound by California’s
six-month statute of limitations for challenging the
formation, dissolution, or change in the territorial boundaries
of a local government entity. App., infra, 16a. In addition,
the court concluded that, “[i]nequitable though it may seem,
the Government’s entering into contracts for the past twenty
years . . . does not waive its right to challenge the
detachment.” Jd. at 17a.
> The NFPD agreed to continue providing fire protection and
emergency medical services to Hamilton Field during the
pendency of this litigation, provided that the federal government
makes payments for the services into an escrow fund. App., infra,
l4an.l.
6
The district court next rejected the federal government’s
argument that the detachment violated the federal
government's immunity from state and local taxation. The
district court held that “the detachment does not have the
compulsory character of a tax” and therefore “did not violate
the Supremacy Clause.” Jd at 18a. The district court went
on to hold, however, that the detachment was invalid under
state law, because (1) the federal government filed written
protests representing more than 50 percent of the assessed
value of the land to be detached; and (2)the votes of
residents within the area to be detached were not tallied
separately from those outside the area to be detached.’
Accordingly, the district court entered summary judgment for
the federal government.’
Proceedings in the Court of Appeals
The Ninth Circuit declined to consider the federal
government's claims under state law, thus implicitly
recognizing that they could not support the district court’s
’ As to the “50 percent” protest requirement, the district court
acknowledged that the relevant California statute was amended in
1977 to require a written protest by 50 percent of the voters,
without regard to their percentage of property ownership, see App.,
infra, \9a-20a, after similar provisions had been held
unconstitutional, see Curtis v. Board of Supervisors, 501 P.2d 537
(Cal. 1972): Levinsohn v. City of San Rafael, 40 Cal. App. 3d 656,
115 Cal. Rptr. 309 (1974). As to the “[sJeparate [t]ally”
requirement, the district court acknowledged that the relevant
California statute was “ambiguous,” cited no authority to support
its interpretation, and rejected a_ state appellate court’s
contemporaneous view that detachment could be confirmed “by an
election in the entire district.” /d. at 20a-21a (rejecting Simi Valley
Recreation & Park Dist. v. Local Agency Formation Comm'n_of
Ventura County, 51 Cal. App. 3d 648, 676, 124 Cal. Rptr. 635
(1975)).
* The district court dismissed as moot the federal government's
claim against the City of Novato.
j
decision. App., infra, 1la: see Department of Commerce v.
United Siates House of Representatives, 119 S. Ct. 765, 779
(1999) (“If there is one doctrine more deeply rooted than any
other in the process of constitutional adjudication, it is that
we ought not to pass on questions of constitutionality . . .
unless such adjudication is unavoidable.”) (quoting Spector
Motor Serv., Inc. v. McLaughlin, 323 U.S. 101. 105 (1944),
and citing Ashwander v. TVA, 297 US. 288, 347 (1936)
(Brandeis, J., concurring)). The court of appeals similarly
declined to decide whether claims under state law are subject
to California’s six-month statute of limitations. App., infra,
12a n.7. Instead, the Ninth Circuit affirmed the district
court’s decision based solely on the constitutional argument,
rejected by the district court, that the detachment of Hamilton
Field from the NFPD violated the federal government's
immunity from state and local taxation. App., infra, Sa-10a.
The Ninth Circuit recognized that “the District never
attempted to directly assess taxes from the United States.”
App., infra, 5a. But the court nevertheless held that the
contractual payments were “equivalent to a_ theoretical
property tax” because they were “based not upon the actual
cost of services to Hamilton Field, but rather upon the value
of the property in question.” Jd at 5a-6a. The court of
appeals further held that the detachment of Hamilton Field
from the NFPD violated the Supremacy Clause of the
Constitution because “[t]he intent of the detachment action
was to circumvent inter-governmental tax immunity by
removing the District’s pre-existing duty to provide core
government services.” /d. at 7a.
REASONS FOR GRANTING THE WRIT
- More than 20 years ago, the NFPD invoked the
procedures established by California law to alter its
boundaries. Following a public hearing and an election, the
appropriate state authorities recognized and approved the
detachment of Hamilton Field from the NFPD. The federal
8
government did not seek judicial review of the detachment
within the six-month period provided by state law. For 20
years thereafter, the federal government entered into annual
contracts with the NFPD to provide fire protection and
emergency services to Hamilton Field.
Despite this history, the Ninth Circuit held that the
Constitution imposes on the NFPD an open-ended obligation
to provide free fire protection and emergency medical
services to Hamilton Field, and invalidates — decades after
the fact — a change in the NFPD’s boundaries pursuant to
California law. The Ninth Circuit’s decision goes far beyond
the narrow confines of the federal government’s immunity
from state taxation established by this Court’s decisions, and
directly conflicts with the principles on which those
decisions are based. Indeed, the Ninth Circuit’s decision
raises a serious issue of federalism, by allowing the
Executive Branch of federal government to conscript state
and local officials into its service, at no cost to itself and
without authorization from Congress.
I. The Ninth Circuit’s Decision Conflicts With
Decisions Of This Court Narrowly Confining
Federal Immunity From State Taxation To Direct
Levying Of Taxes Upon The Federal Government.
1. This Court, speaking through Chief Justice Marshall,
recognized the doctrine of federal immunity from state
taxation in M'Culloch v. Maryland, 17 U.S. (4 Wheat.) 316
(1819). Declaring that “the power to tax involves the power
to destroy,’ M’'Culloch invalidated a state tax on the Bank of
the United States. Jd at 431. Subsequently, the Court
embarked on a course of expanding the federal government’s
tax immunity to cover, among other things, state taxes on the
income of federal employees, Dobbins v. Commissioners of
Erie County, 41 U.S. (16 Pet.) 435 (1842), on income derived
from property leased from the federal government, Gillespie
v. Oklahoma, 257 U.S. 501 (1922), and on sales to the United
9
States, Panhandle Oil Co. v. Mississippi ex rel. Knox, 277
U.S. 218 (1928).
“Shortly after reaching its zenith in the Gillespie
decision,” however, “the doctrine of intergovernmental tax
immunity started a long path in decline and has now been
‘thoroughly repudiated’ by modern case law.” Cotton
Petroleum Corp. v. New Mexico, 490 U.S. 163, 174 (1989)
(quoting South Carolina v. Baker, 485 U.S. 505, 520 (1988)).
In the Panhandle Oil case, Justice Holmes, joined by Justices
Brandeis and Stone, wrote in dissent: “The power to tax is
hot the power to destroy while this Court sits.” 277 US. at
223. Justice Frankfurter commented that “[t]he web of
unreality spun from Marshall’s famous dictum was brushed
away by one stroke of Mr. Justice Holmes’ pen.” Graves v.
People of New York ex rel. O'Keefe, 306 U.S. 466, 490
(1939) (Frankfurter, J., concurring).
The Court soon recognized that its decisions expanding
the federal government’s immunity from state taxation “were
increasingly divorced both from the constitutional
foundations of the immunity doctrine and from ‘the actual
workings of our federalism.’” United States v. New Mexico,
455 U.S. 720, 731 (1982) (quoting Graves, 306 U.S. at 490
(Frankfurter, J., concurring)). The Court’s decision in James
v. Dravo Contracting Co., 302 U.S. 134 (1937), “marked a
major change in course.” New Mexico, 455 U.S. at 731. In
James, the Court upheld a state tax on a contractor providing
services to the federal government. In subsequent cases, the
Court dramatically cut back on the scope of the tax immunity
doctrine. See Helvering v. Mountain Producers Corp., 303
~ U.S. 376, 386-87 (1938) (overruling Gillespie and holding
that the federal government may tax income derived from a
state lease); Graves, 306 U.S. at 486-87 (overruling Dobbins
and holding that a state may tax the income of federal
employees); Alabama v. King & Boozer, 314 US. 1 (1941)
10
(overruling Panhandle Oil and holding that a state may tax
sales to the United States).
The Court’s more recent decisions hold that “tax
immunity is appropriate in only one circumstance”: where a
State “lay[s] a tax ‘directly upon the United States.’” New
Mexico, 455 U.S. at 733, 735 (quoting Mayo v. United States,
319 U.S. 441, 447 (1943)). The Court has emphasized that
“the limits on the immunity doctrine are . . . as significant as
the rule itself.” 455 U.S. at 734. “[I]mmunity may not be
conferred simply because [a] tax has an effect on the United
States, or even because the Federal Government shoulders
the entire economic burden of the levy.” /d Such
considerations are, in fact, “constitutionally irrelevant.” /d.
The Court’s “narrow approach” to the federal
government’s immunity from state and local taxation
“comports with the principal purpose of the immunity
doctrine, that of forestalling ‘clashing sovereignty,’
M'Culloch v. Maryland, 4 Wheat., at 430, by preventing the
States from laying demands directly on the Federal
Government.” New Mexico, 455 U.S. at 735. The Court has
acknowledged that the doctrine of federal immunity from
state taxation has been so narrowed by modern judicial
decisions that it “has taken on essentially symbolic
importance.” /d.”
* The Court has observed that “[o]ne could, and perhaps should,
read M'Culloch . . . simply for the principle that the Constitution
prohibits a State from taxing discriminatorily a_ federally
established instrumentality.” New Mexico, 455 U.S. at 733
(quoting First Agric. Bank v. State Tax Comm'n, 392 U.S. 339,
350 (1968) (dissenting opinion)). Given the long history of the
doctrine, however, the Court has narrowed the immunity to its
current “essentially symbolic” dimensions rather than doing away
with it entirely. /d. at 735.
1]
In Washington v. United States, 460 U.S. 536, 541 ( 1983),
the Court applied these principles to hold that an action of
state or local government may not be held unconstitutional:
on the ground that it “circumvent[s] the Federal
Government’s tax immunity.” The Court has thus squarely
rejected the rationale relied on by the court of appeals in this
case. Compare App., infra, 7a (“The intent of the
detachment action was to circumvent inter-governmental tax
immunity.”’).
In Washington, the state legislature imposed a sales tax on
landowners who purchased construction work from a
contractor. Because of the federal government’s tax
immunity, the sales tax could not be applied to construction
purchased by the federal government. The state legislature
acted to eliminate the federal government’s tax exemption by
imposing a sales tax on materials purchased by contractors
doing construction work for the federal government. The
Court rejected the “principal argument” of the United States,
that the tax on federal contractors was invalid because it
“circumvented the Federal Government’s tax immunity.”
460 U.S. at 541; see also id at 543 n.9. In so holding, the
Court recognized that a state or local government is
permitted to “accommodate[] for the fact that it may not
impose a tax directly on the United States.” /d. at 546.
Just last Term, the Court reaffirmed the narrow scope of
federal immunity from state taxation recited in Washington
and the other cases of the last 60 years, and declined to
extend the immunity “beyond the tight limits this Court has
set.” Jefferson County, Alabama v. Acker, 119 S. Ct. 2069.
2077 (1999); see also Arizona Dep't of Revenue v. Blaze
Constr., Inc., 119 S. Ct. 957, 959 (1999) (immunity confined
within “narrow constitutional limits’’).
2. The Ninth Circuit’s decision sweeps far bevond the
narrow limits of the federal immunity from state taxation
established by this Court’s decisions. and directly conflicts
12
with the principles upon which those decisions are based. As
both courts below recognized, the NFPD did not “lay a tax
‘directly upon the United States.’” New Mexico, 455 US. at
733. “[T]he standard definition of a tax” for purposes of the
federal government’s immunity from state taxation is “‘an
enforced contribution to provide for the support of the
government.’” United States v. State Tax Comm'n of Miss.
421 U.S. 599, 606 (1975) (quoting United States v. La
Franca, 282 U.S. 568, 572 (1931)) (emphasis added). The
“enforced” nature of the contribution is an essential attribute
of a tax. “[F]Jailure to pay a tax results in civil and sometimes
criminal penalties.” United States v. City of Columbia, Mo.,
914 F.2d 151, 155 (8th Cir. 1990). See also United States v.
City of Huntington, W.Va., 999 F.2d 71, 73 n4 (4th Cir.
1993) (a tax is “[a]n involuntary pecuniary burden” that is
“fiJmposed by, or under authority of the legislature... .
[u]nder the police or taxing power of the state”), cert. denied,
510 U.S. 1109 (1994); id at 74 (Taxes are “enforced
contribution[s] for the support of government,” rather than
“payments given in return for a government-provided
benefit.”) (quoting LaFranca, 282 U.S. at 572).
As the district court held and the court of appeals nowhere
disputed, the NFPD’s actions lack “the compulsory character
of a tax.” App., infra, 18a. The NFPD never attempted to
extract an enforced contribution from the federal
government. To the contrary, by detaching Hamilton Field
the NFPD eliminated any possible basis under state law for
exacting an involuntary contribution from the federal
government. The federal government was free to arrange its
own fire protection, continue with the NFPD, or with other
fire fighting agencies in the area. As the Ninth Circuit
expressly recognized, the NFPD “never attempted to directly
assess taxes from the United States.” Jd at 5a. Under this
Court’s decisions, the Ninth Circuit’s analysis of the federal
government’s constitutional claim should have ended with
that recognition. See New Mexico, 455 U.S. at 733 (federal
13
tax immunity applies only where a State “lay[s] a tax
‘directly upon the United States’”).
As noted above, the Ninth Circuit’s decision also conflicts
with this Court’s decision in Washington v. United States,
supra. The Ninth Circuit held that the detachment of
Hamilton Field is unconstitutional because “[t]he intent of
the detachment was to circumvent inter-governmental tax
immunity.” App., infra, 7a. That is directly contrary to this
Court’s express rejection of the proposition that actions
intended to “circumvent[]” the federal government’s tax
immunity are unconstitutional, and to this Court’s
recognition that a state or local government is permitted to
“accommodate[] for the fact that it may not impose a tax
directly on the United States.” Washington, 460 U.S. at 541,
543 n.9, 546.°
3. One of the reasons given by this Court for adhering to
a narrow constitutional doctrine of federal immunity from
state taxation is that “Congress can confer an immunity from
state taxation.” California State Board of Equalization v.
Sierra Summit, Inc., 490 U.S. 844, 851 (1989) (citations
omitted). The Court has concluded that if federal tax
immunity “is to be expanded beyond its narrow
constitutional limits, it is Congress that must take
responsibility for the decision.” New Mexico, 455 U.S. at
° The Court’s opinion in Washington reiterated the rule that “‘[s]o
long as the tax is not directly laid on the Federal Government, it is
valid if nondiscriminatory . . . or until Congress declares
otherwise.”” Washington, 460 U.S. at 540 (quoting United States
v. County of Fresno, 429 U.S. 452, 460 (1977)). In this case, the
NFPD has not levied any tax, and thus the question whether it has
levied a discriminatory tax does not arise. In any event, the NFPD
has not discriminated against the federal government. A state or
local government “does not discriminate against the Federal
Government and those with whom it deals unless it treats someone
else better than it treats them.” Washington, 460 U.S. at 544-45.
14
737. This is “wholly appropriate, for the political process is
‘uniquely adapted to accommodating the competing
demands’ in this area.” Jd at 737-738 (quoting
Massachusetts v. United States, 435 U.S. 444, 456 (1978)
(plurality opinion)). Thus, “absent congressional action . . .
the States’ power to tax can be denied only under ‘the
clearest constitutional mandate.’” /d at 738 (quoting
Michelin Tire Corp. v. Wages, 423 U.S. 276, 293 (1976));
see also id. (“{I]n contracting the once expansive
intergovernmental tax immunity doctrine, we have
recognized that the area is one over which Congress is the
principal superintendent.”); Blaze Constr., 119 S. Ct. 960
(the taxation decision “rests . . . with the State of Arizona and
with Congress”); United States v. California, 507 U.S. 746,
751 (1993).
Congress has not found it necessary to enact legislation to
protect the federal government from state and local
governments in connection with the provision of fire service.
To the contrary, Congress has enacted legislation that is
intended to protect state and local governments from the
federal government. See 15 U.S.C. § 2210 (1999). Section
2210 provides for reimbursement to state and local
government entities for the costs of fighting fires on federal
property, to the extent that those costs are not already
covered by “payments . . . to the fire service or its parent
jurisdiction, including taxes or payments in lieu of taxes, the
United States has made for the support of fire services on the
property in question.” 15 U.S.C. § 2210(b)(1) (emphasis
added). Thus Congress, far from legislating to protect the
United States from exactions by state and local governments,
has expressly recognized the propriety of “taxes or payments
in lieu of taxes” for the support of fire services on federal
property. The Ninth Circuit’s decision is thus flatly contrary
to this Court’s decisions holding that Congress is the
“principal superintendent” of federal tax immunity, and that
such questions should be left to “the political process,” which
15
is “‘uniquely adapted to accommodating the competing
demands’ in this area.” New Mexico, 455 U.S. at 737
(citation omitted).
6
4. The Ninth Circuit reasoned that the contracts between
. the federal government and the NFPD were an
unconstitutional tax because the amount that the federal
government paid for fire and emergency services was based
on an estimate of the assessed value of the property owned
by the federal government, rather than on the cost of
providing services to that property. App., infra, 5a-7a. This
line of reasoning might have been appropriate if the NFPD
had sought to extract an enforced contribution from the
federal government. But the NFPD and the federal
government entered into and annually renewed a voluntary
agreement, and therefore the amount that the federal
government agreed to pay is constitutionally irrelevant. As
this Court held in a closely related context, “the
Government’s voluntary agreement to reimburse (or even
fund in advance) . . . taxes” is of no constitutional
significance. United States v. California, 507 U.S. at 753
(holding that the federal government’s voluntary agreement
to pay in full, and to fund in advance, state taxes levied on
government contractors falls outside the federal immunity
from state taxation).
The Ninth Circuit’s decision bars state and local
government entities from invoking the procedures established
under state law for altering their boundaries, and imposes on
state and local governments a constitutional obligation to
provide free services to the federal government ad infinitum.
In the hands of the Ninth Circuit, the federal government’s
immunity from state taxation has been transformed from a
safeguard against the NFPD’s hypothetical (and fanciful)
power to destroy the federal government through taxation,
into a very real power of the federal government to destroy
local governments by demanding potentially unlimited
16
amounts of free services, without regard to whether the
federal government’s-demand for these services “imposes an
intolerable burden upon the remaining property owners” and
taxpayers. C.A. App. 25. The Ninth Circuit’s decision thus
directly undermines the very basis of the intergovernmental
tax immunity doctrine, which is “the need to protect each
sovereign’s operations from undue interference by the other.”
See Davis v. Michigan Department of Treasury, 489 U.S.
803, 814 (1989) (citing Graves, 306 U.S. at 481).’
Il. The Ninth Circuit’s Decision Raises A Serious
Issue of Federalism.
1. The Ninth Circuit’s decision not only oversteps the
narrow boundaries of the federal government’s constitutional
immunity from state taxation, but also creates a serious
constitutional issue by intruding on the basic operations of
state and local government. In Printz v. United States, 521
U.S. 898, 909 (1997), this Court held that “the Federal
Government may [not] command the States’ executive power
in the absence of a particularized constitutional
authorization,” even when Congress does so through explicit
legislation. The Court based that holding on the
“incontestible” proposition that “the Constitution established
a system of ‘dual sovereignty.’” Jd. at 918 (quoting Gregory
v. Ashcroft, 501 U.S. 452, 457 (1991)). “[T]he Framers
rejected the concept of a central government that would act
upon and through the States, and instead designed a system
in which the state and federal governments would exercise
In a prior case in which a local fire district declined to provide
free fire protection services to a federal military base, the
Comptroller General recognized that if the fire district took “action
to have its boundaries changed to exclude the federal reservation,”
there “would be no question but that the district would have no
obligation to furnish fire protection services to the federal
property.” 45 Comp. Gen. 1, 1965 WL 1676 at *3 (1965).
17
concurrent authority over the people—who were, in
Hamilton’s words, ‘the only proper objects of government.’”
Id. at 919-20 (quoting The Federalist No. 15, at 109). See
also New York v. United States, 505 U.S. 144, 161-66 (1992).
Under our dual system, “‘[t]he local or municipal authorities
form distinct and independent portions of the supremacy, no
more subject, within their respective spheres, to the general
authority than the general authority is subject to them, within
its own sphere.”” Printz, 521 U.S. at 920-21 (quoting The
Federalist No. 39, at 245). The Court concluded that that
“[t]he power of the Federal Government would be augmented
immeasurably if it were able to impress into its service—and
at no cost to itself—the police officers of the 50 States.” Jd
at 935.
2. The Ninth Circuit’s decision has precisely the effect
of allowing the federal government to impress into its
service, at no cost to itself, the officers of the NFPD. Under
that decision, once a state or local government incurs an
obligation to provide services to federal property located
within its boundaries, it cannot avail itself of the means
provided by state law to change those boundaries, but must
continue providing free services for as long as the federal
government demands them. :
The federalism issue created by the Ninth Circuit’s
decision is particularly troubling because it disregards the
role of Congress, which this Court has said is paramount in
the area of federal tax immunity. Like Printz, the usual
Tenth Amendment case arises after Congress has enacted
legislation, thus affording the basis for an argument that
* The Court made clear that local governmental entities, not just
States, are fully “protected by the Constitution’s guarantees of
federalism, including the Tenth Amendment.” Jd. at 931 n.15
(citations omitted).
18
States “find their protection from congressional regulation
through the national political process.” South Carolina v.
Baker, 485 U.S. at 512 (citing Garcia v. San Antonio Metro.
Transit Auth., 469 U.S. 528, 537-54 (1985)). The Ninth
Circuit’s decision, in contrast, short-circuits the national
political process (as well as upsetting the results of a state
political process concluded more than 20 years ago).
In sum, the Ninth Circuit has intruded into the most basic
operations of state and local government, resulting in
precisely the “clashing sovereignty” that the
intergovernmental tax immunity doctrine was intended to
forestall. M’'Culloch, 17 U.S. (4 Wheat.) at 430. The Ninth
Circuit’s decision is alien to the purpose and narrow limits of
the federal immunity from state taxation, and conflicts with
this Court’s decisions interpreting and limiting the immunity.
Far from protecting the federal government against the
State’s assumed “power to destroy” through taxation, the
Ninth Circuit’s decision confers on the federal government a
wholly unwarranted power to burden or even destroy local
government by asserting a constitutional entitlement to free
government services.
19
CONCLUSION
For the reasons stated above, the petition should be
granted.
Respectfully submitted,
Of Counsel: E. Edward Bruce
Gregory A. Wedner, Esq. Pung of Record
BERGMAN & WEDNER, INC. obert A. Long, Jr.
Suite 900 Anthony J. Vlatas
TsIchj COVINGTON & BURLING
10880 Wilshire Boulevard
Los Angeles, CA 90024-4101 1201 Pennsylvania Ave., N.W.
(310) 470-6110 Washington, D.C. 20004-2401
(202) 662-6000
George J. Silvestri, Jr.
LAW OFFICES OF GEORGE J.
SILVESTRI, JR.
250 Bel Marin Keys Blvd., #F-200
Novato, CA 94949
(415) 883-8800
January 2000 Counsel for Petitioner
APPENDIX A
NOVATO FIRE PROTECTION DISTRICT,
Plaintiff-Appellant,
V.
UNITED STATES OF AMERICA; U.S. COAST GUARD,
Defendants-Appellees.
No. 98-15441.
United States Court of Appeals,
Ninth Circuit.
Argued and Submitted Feb. 9, 1999.
Filed July 7, 1999.
Appeal from the United States District Court for the Northern
District of California. D.C. No. CV-96-03893-FMS.
Before: WOOD,' THOMPSON, and THOMAS, Circuit
Judges.
THOMAS, Circuit Judge:
In this appeal, we must decide whether a detachment
action was a legitimate exercise of local government powers,
Or an unconstitutional attempt to tax the United States. We
conclude that the attempted detachment was an attempt to
levy a tax on the United States, and therefore violated the
Supremacy Clause. Accordingly, we affirm the district court.
' The Honorable Harlington Wood, Jr., Senior United States Circuit
Judge for the Seventh Circuit Court of Appeals, sitting by
designation.
(1a)
2a
I
Beginning in 1931, the United States acquired, through
purchase, donation and condemnation, portions of land in
Northern California commonly known as Hamilton Field,
upon which it built the Hamilton Air Force Base military
facility ("the base"). See State of California ex rel State
Lands Comm'n v. United States, 512 F.Supp. 36, 37-38
(N.D.Cal.1981). From the time it was built until it was
decommissioned in 1974, the base provided its own first
response fire protection.
With the termination of active Air Force operations,
management of the structural facilities at Hamilton Field,
including government housing, post exchange, commissary
and gas stations, was transferred to the United States Navy.
Hamilton Field's runways and air-support facilities were
operated at various times by the United States Air Force and
Army Reserves. Beginning in 1996, the United States Coast
Guard, which had previously occupied some portions of the
base for use by its Pacific Strike Team, also commenced
management of some facilities at Hamilton Field.
Following the decommissioning of the base in 1974, the
Air Force maintained only minimal fire protection at
Hamilton Field, essentially limiting coverage to
aeronautically-related fires. Because the base was left
without structural fire protection, the Navy contracted with
the Novato Fire Protection District ("District") for fire
protection and emergency medical services for those portions
of Hamilton Field managed by the Navy and the Coast
Guard. The contract provided for the payment of a flat fee in
the amount equivalent to the revenue that the District would
have received if the Navy properties were assessed local
property taxes. The contract has been annually renewed by
the parties.
Concerned that the contractual arrangements might
constitute an impermissible inter-governmental tax, the
eee _—
3a
District commenced proceedings to detach Hamilton Field
from the District, with the hope of providing fire protection
services to Hamilton Field on an out-of-district contractual
basis.2 Thus, in November 1976, the District's Board of
Commissioners ("District Board") adopted a resolution
applying for detachment of Hamilton Field from the legal
boundaries of the District. The stated purpose of the
proposed detachment was to ensure that the District would
continue to "receive compensation for any services it
provided to the currently tax exempt properties."
In February 1977, the Local Agency Formation
Commission of Marin County ("LAFCo")’ passed a
> At the time of this detachment action, the requisite procedures for
such actions were codified at California Government Code sections
56000 through 56550 (West 1966). Detachment was defined at
section 56038 as "the detachment, deannexation, exclusion, deletion
or removal from a district of any portion of the territory of such
district." Cal. Gov't Code § 56038 (West 1966).
* LAFCo is an acronym generally used to refer to a California local
agency formation commission. At the time of the detachment
action the statutory powers of these agencies were codified in
California Government Code sections 54773 through 54799.5
(West 1966). The purpose of these LAFCos was "the orderly
development of local agencies," to which end they were vested
with the power to "develop and determine the sphere of influence"
of each California county. Cal. Gov't Code § 54774 (West 1966 &
Supp.1976); see also Simi Valley Recreation and Park Dist. v.
Local Agency Formation Commission of Ventura County, 51
Cal.App.3d 648, 124 Cal.Rptr. 635, 648-49 (1975) (interpreting,
inter alia, section 54774 in delineating the authority of a LAFCo in
a challenged detachment action). Thus, in California counties,
local agency formation commissions were vested with the power
to organize districts such as the fire protection district at issue in
this case. Cal. Gov't Code § 54774 (West 1966 & Supp.1976).
The provisions controlling the formation and powers of LAFCos
have been subject to substantial revision since the time of the
detachment action, and are now codified at California Government
Code sections 56325 through 56337 (West 1997 & Supp.1999).
4a
resolution approving the detachment proceedings and calling
for an election to confirm or reject the decision of the District
Board to detach Hamilton Field. On August 1, 1977, the
District Board adopted a resolution formally initiating
detachment proceedings, and setting August 17, 1977, as the
date for a hearing on the proposed detachment. On August
15, 1977, the Navy notified the District Board that it objected
to the proposed detachment. The Air Force lodged similar
written protests in letters dated August 8, and August 16,
1977. On August 17, 1977, the District Board conducted the
public hearing, and passed and adopted a resolution in favor
of the detachment action.
On August 26, 1977, LAFCo's Executive Officer provided
a written analysis of the proposed detachment. This analysis
reiterated the stated purpose of the detachment action, and
indicated that the Air Force, Navy, and Government Service
Administration opposed the action.
A single—tally election—one combining the votes taken
both within and outside the area to be detached—was held on
November 8, 1977. After the election, in which the
detachment action was approved by a vote of 3949 "yes"
votes to 943 "no" votes, the District Board adopted a
resolution ordering Hamilton Field detached from the District
on the basis of a majority vote. Subsequently, the
detachment was recognized by LAFCo and by the California
Secretary of State.
On October 8, 1996, after the District and the Navy were
unable to agree on the terms of the contract for the District's
provision of fire protection and emergency medical services
to Hamilton Field, the District initiated this action by filing a
complaint in the Superior Court of California for the County
of Marin, seeking a judicial declaration as to the validity of
the detachment action. Such a declaration would have
effectively required the United States to continue to contract
with the District for fire and emergency medical services.
Sa
The United States removed the case to the United States
District Court for the Northern District of California, where it
sought a judicial declaration that the District was required by
state law to provide fire protection services to Hamilton
Field. After the issue had been joined, the District and the
United States filed cross-motions for summary judgment.
The district court granted the United States’ motion on the
_ ground that the detachment action was invalid under
California state law. The district court therefore also denied
the District's summary judgment motion. Judgment was
entered on January 29, 1998, and the District timely
appealed.
I]
With its decision in M'Culloch v. Maryland, 17 U.S. (4
Wheat.) 316, 4 L.Ed. 579 (1819), the Supreme Court first
articulated the principle that the Supremacy Clause, United
States Constitution, Article VI, clause 2, precludes a state
from levying a tax on the operations of the United States. In
United States v. Allegheny County, 322 U.S. 174, 176, 64
S.Ct. 908, 88 L.Ed. 1209 (1944), the Supreme Court
reaffirmed and expanded upon the pprinciple that
"possessions, institutions, and activities of the Federal
Government itself in the absence of congressional consent
are not subject to any form of state taxation." Although the
broad scope of governmental tax immunity has been tailored
to cover only taxes on instrumentalities "so closely connected
with the government that the two cannot realistically be
viewed as separate entities," United States v. New Mexico,
455 U.S. 720, 735, 102 S.Ct. 1373, 71 L.Ed.2d 580 (1982),
the parties do not dispute that the federal occupants of
Hamilton Field enjoy inter-governmental tax immunity.
Although Hamilton Field was always situated completely
within the contours of the District's boundaries, the District
never attempted to directly assess taxes from the United
States. However, when the District assessed a fee equivalent
6a
to a theoretical property tax as a condition for providing fire
and emergency medical services, its actions clearly ran afoul
of the Supremacy Clause.
When analyzing whether a _ fee constitutes an
impermissible tax, "we are not bound by the characterization
given to a state tax by state courts or legislatures, or relieved
by it from the duty of considering the real nature of the tax
and its effect upon the federal right asserted." Carpenter v.
Shaw, 280 U.S. 363, 367-68, 50 S.Ct. 121, 74 L.Ed. 478
(1930). When the a fee is imposed on the United States for
the purpose of extracting by fee that which cannot be
extracted by taxation, the imposition of that fee may violate
the Supremacy Clause. See United States v. City of
Huntington, 999 F.2d 71, 73 (4th Cir.1993).
This is not to say that the United States cannot be charged
reasonable fees related to the cost of governmental services
provided, such as payment for metered water usage. See id.
However, the contractual fees that the District charged the
government in exchange for continued fire and emergency
medical protection were based not upon the actual cost of
services provided to Hamilton Field, but rather upon the
value of the property in question. The fee was calculated to
be "an amount equivalent to the revenue the District would
receive were the Navy on property tax roles." The assessed
tax value of a property is not equivalent to the cost of
services rendered to that property. Indeed, tax revenue may
be allocated to unrelated government services. See San
Miguel Consolidated Fire Protection Dist. v. Davis, 25
Cal.App.4th 134, 30 Cal.Rptr.2d 343 (1994) (upholding as
constitutional a statute reallocating property tax revenue from
fire protection districts to county educational revenue
augmentation funds.)
Although this Circuit has never reached the question, the
Fourth Circuit and the Court of Claims have found that the
imposition of a flat fee such as the one employed by the
at
+ Anaad MeO lana
BaD RN ie See RD Ret Lj hea
Ta
District is unconstitutional. See Folio v. City of Clarksburg,
134 F.3d 1211, 1217 (4th Cir.1998); City of Cincinnati v.
United States, 39 Fed. Cl. 271, 275-76 (Fed.Cl.1997), aff'd by
153 F.3d 1375 (Fed.Cir.1998). Furthermore, in Huntington,
the Fourth Circuit concluded that fire protection was a core
government service, and that, consequently, the attempts by a
municipality to charge for this and other such services were
invalid. 999 F.2d at 74. Otherwise "virtually all of what are
now considered taxes could be transmitted into user fees by
the simple expedient of dividing what are generally accepted
as taxes into constituent parts, e.g., a police fee." Jd
Accordingly, we hold that the fees charged to the United
States by the District for fire protection and emergency
medical services clearly constituted an impermissible tax.
III
Because we must look at the effect, not the form, of the
local government action, Allegheny County, 322 U.S. at 184,
64 S.Ct. 908, we also conclude that the District's detachment
violated the Supremacy Clause. The intent of the detachment
action was to circumvent inter-governmental tax immunity
by removing the District's pre-existing duty to provide core
government services. We cannot allow a municipality to
initiate a detachment action with the purpose of charging the
federal government a flat fee for basic services that the
municipality otherwise has a duty to provide. To do so
would effectively give that municipality a method of
assessing a property tax from the federal government in
exchange for the provision of any and all basic services. This
is not constitutionally permissible under the Supremacy
Clause.
Decisive in this analysis is the fact that the District did, in
fact, have a duty to provide the core services to the United
States prior to the attempted detachment eaction. Fire
protection districts were and are part of a comprehensive
state program of fire protection, charged with the duty and
8a
responsibility of providing fire protection within the defined
district boundaries.* At the time of the attempted
detachment, a fire protection district was required to provide
primary fire protection services to all entities in the district,
even structures designated as in the State's area of
responsibility. See Cal. Health & Safety Code § 13821
(West 1966 & Supp.1976).
When the District was formed, Hamilton Field was
included within the district boundaries. Thus, the District
had the obligation to provide fire protection and emergency
medical services. The fact that the Air Force chose to
* At the time of the action, California Health and Safety Code
section 13821 provided: "The district shall have fire protection
responsibility for the structures in the area." (Emphasis added.)
When the statute was amended in 1987, the California legislature
re-affirmed the duties of the fire protection district. See Cal.
Health & Safety Code § 13811 (West 1994 & Supp.1999). The
legislature also made findings as to the historic and continuing role
of the fire protection district in California, providing:
The Legislature finds and declares that the local provision
of fire protection services, rescue services, emergency
medical services, hazardous material emergency response
services, ambulance services, and other services relating to
the protection of lives and property is critical to the public
peace, health, and safety of the state. Among the ways that
local communities have provided for those services has
been the creation of fire protection districts. Local control
over the types, levels, and availability of these services is a
long-standing tradition in California which the Legislature
intends to retain. Recognizing that the state's communities
have diverse needs and resources, it is the intent of the
Legislature in enacting this part to provide a broad statutory
authority for local officials. The Legislature encourages
local communities and their officials to adapt the powers
and procedures in this part to meet their own circumstances
and responsibilities.
Id. at § 13801.
4
;
v
2
|
:
5
4
2
Ff
A
;
4
5
9a
maintain its own first response system for many years does
not alter the District's legal duties.° In fact, during the period
the Air Force provided a first response service, the District
provided secondary response services. The District, of
course, recognized its duty to provide services, and
commenced the detachment procedure to relieve itself of this
duty. Indeed, the District has been refreshingly candid in its
aims. LAFCo's Executive Director noted in his analysis of
detachment that the "federally owned lands are exempt from
taxation" and that the District wished a contract that
"generally provides for payment of an amount equivalent to
the revenue the District would receive were the . . . properties
on the tax rolls."
Given this acknowledgment of a pre-existing duty to
provide an essential government service, the District cannot
now contrive to tax the United States through
gerrymandering. There is a balance to be struck in
ascertaining when local government action is,*in fact, a
disguised attempt to tax the United States. Courts must be
careful not to intrude on the legitimate actions of local
governments. However, under the unique circumstances of
this case, it is clear that the local government action was
* Although not binding, we note that the decisions of the
Comptroller General also invoke this reasoning. In a ruling issued
to the Administrator of the General Service Administration, 53
Comp. Gen. 410, 1973 WL 8803 (1973), the Comptroller General
held that: "Where there existed a statutory duty of a municipality,
fire district or county to render firefighting services to a property
within its limits without cost to the owners of the property, such
duty extended to protecting the property of the United States." /d. at
* 2. Because the fire protection district in that case had a statutory
duty to provide the services in question, the Comptroller General
concluded that there was no legal basis upon which to authorize
payments for such service. /d.
10a
purely designed to circumvent M'Culloch and its progeny.
As such, the detachment violated the Supremacy Clause.
IV
We also reject the District's contention that the doctrines
of estoppel and waiver bar the United States' challenge to the
detachment action. These doctrines are equitable remedies.
See Burbank-Glendale-Pasadena Airport Auth. v. City of
Burbank, 136 F.3d 1360, 1362 (9th Cir.1998). We therefore
review the trial court's refusal to grant these remedies for an
abuse of discretion. See Levi Strauss & Co. v. Shilon, 121
F.3d 1309, 1313 (9th Cir.1997).
A party claiming estoppel against the government must
demonstrate both that it detrimentally relied on the
Government's conduct, and that it did so reasonably. See
Heckler v. Community Health Serv. of Crawford, 467 U.S.
51, 59, 104 S.Ct. 2218, 81 L.Ed.2d 42 (1984). In this case,
the district court determined that the District was required to
show that "it is worse off than it would have been had the
government insisted upon free fire protection from the start,
and this it has not done." Citing Heckler, 467 U.S. at 62-62,
104 S.Ct. 2218, the district court indicated that the District's
"inability to retain money it should never have received" is
not a sufficient detriment. The court thereby determined that
the government was not estopped from challenging the
validity of the detachment and the future payments that the
action would require. We agree. The district court did not
abuse its discretion in refusing to apply the doctrine of
estoppel in this case, and we affirm its conclusion.
The District also argues that the doctrine of waiver bars
the United States' claim, because the Navy and Army made
twenty years of uninterrupted contract payments, which stand
as “conclusive evidence of intentional relinquishment of
known rights" by the United States. However, the district
court concluded that, because the detachment was invalid,
and the District was therefore at all times obligated to
lla
provide free fire and emergency medical services to the area,
the agents of the government who entered into these
contracts were unauthorized to pay for the free service. See
In re 9-1-1 Emergency Number Fee, Hillsborough County,
Florida, 66 Comp. Gen. 385, 1973 WL 8803, at * 2 (1987)
("absent a tangible henefit and measurable value to the
United States, there is no authority to pay any service
charge"). The district court therefore concluded that the
government had not waived its rights because it could not be
bound by the illegal actions of its officers. See United States
v. Fowler, 913 F.2d 1382, 1385-86 (9th Cir.1990). We
agree, and find that the district court did not abuse its
discretion in refusing to apply the doctrine of waiver.
V
Because the detachment action was barred by the
Supremacy Clause, we need not determine whether the action
was procedurally deficient under California state law.° Nor
° In this case, the district court also denied the District's motion for
reconsideration, in which the District argued that the government's
action was barred by California Government Code section 850
(West 1995) (providing public entities and employees with absolute
immunity from injury resulting from a failure to provide fire
protection). The denial was issued upon the grounds that the claim
was not raised in its motion for summary judgment. A district court
has discretion to decline to consider an issue raised for the first time
in a motion for reconsideration. Columbia Pictures Television v.
Krypton Broad, 106 F.3d 284, 290 (9th Cir.1997), rev'd on other
grounds, 523 U.S. 340, 118 S.Ct. 1279, 140 L.Ed.2d 438 (1998).
The district court relied upon the Seventh Circuit's decision in
Publisher's Resource, Inc. v. Walker Davis in support of its decision
not to reopen the case on the ground that the argument that was not
raised in the District's initial motion for summary judgment. 762
F.2d 557, 561 (7th Cir.1985). We find that the district court did not
abuse its discretion in refusing to reconsider the matter in light of
this new argument. We also conclude that the District's failure to
raise the issues in the summary judgment motions waives their right
to do so on appeal. Jd.
12a
is the constitutional challenge’ to the detachment action
barred by California's six month limitation period, as the
United States is not bound by state statutes of limitations
period when asserting a federally created right. See United
States v. Summerlin, 310 U.S. 414, 417-18, 60 S.Ct. 1019, 84
L.Ed. 1283 (1940); United States v. Dos Cabezas Corp., 995
F.2d 1486, 1489 (9th Cir.1993); United States v. California,
932 F.2d 1346, 1351 (9th Cir.1991), affd on other grounds,
507 U.S. 746, 113 S.Ct. 1784, 123 L.Ed.2d 528 (1993).
VI
Because the detachment action in this case constituted a
violation of the Sovereign Immunity Clause, the holding and
order of the district court are AFFIRMED.
We need not, and do not, decide whether the United States' state
statutory challenges are barred by California's statute of
limitations. See Cal.Civ.Proc.Code § 349.1 (West 1982) (imposing
six month statute of limitations for legal challenges to the validity
of a district reorganization action).
13a
APPENDIX B
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
NOVATO FIRE PROTECTION _)
DISTRICT, ) No. C 96-3893 FMS
)
Plaintiff, ) ORDER DENYING
) PLAINTIFF’S MOTION
VS. ) FOR SUMMARY
) JUDGMENT; GRANTING
UNITED STATES OF AMERICA,) DEFENDANT’S CROSS-
) MOTION FOR SUMMARY
Defendant. ) JUDGMENT
INTRODUCTION
The parties’ cross-motions for summary judgment require
the Court to determine whether the California statute of
limitations for challenging a detachment proceeding binds
the United States in this case, whether equitable doctrines bar
the suit, whether the detachment of Hamilton Field was an
unconstitutional attempt to tax the United States, and whether
the detachment violated California law.
BACKGROUND
Plaintiff Novato Fire Protection District provides fire
protection and emergency medica! services to all properties
within its geographic boundaries in Marin County. Until
1978, NFPD’s service area included Hamilton Field, a piece
of federal property that was originally used as a military
installation and is now occupied by the Coast Guard.
In 1976, NFPD applied to detach Hamilton Field from its
geographic boundaries. In February of 1977, the Marin
Local Agency Formation Commission approved the
detachment application, provided that the detachment be
confirmed by an election held in Hamilton Field and the
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remainder of NFPD’s service area. After conducting a public
hearing on the issue, NFPD passed a resolution to detach
Hamilton Field. On November 8, 1977, Marin County voters
approved Hamilton Field’s detachment by a vote of 3949 to
943. In January of 1978, the California Secretary of State
issued a Certificate of Filing, confirming the detachment.
Since January of 1978, the United States has entered into
annual contracts with NFPD to purchase fire protection
services for Hamilton Field. In 1996, however, the United
States asserted that the 1978 detachment was invalid, and that
NFPD was obligated to provide fire protection and
emergency medical services to Hamilton field free of charge.
NFPD sued the United States for declaratory relief that the
detachment was valid; the action was removed to federal
court on October 25, 1996.' On May 23, 1997 the Court
permitted the United States to file a third-party complaint
against the City of Novato (the “City”) asserting that if
NFPD was not obligated to provide fire protection, the City
was. On November 12, 1997, the Court granted the City’s
motion for leave to amend its answer by adding a claim
against NFPD.
NFPD now moves for summary judgment and requests
declaratory relief that the detachment of Hamilton Field was
valid, final, and conclusive, and that it has no obligation to
provide services to the Field. The United States cross-moves
for summary judgment and requests declaratory relief that the
Hamilton Field detachment is not valid and that NFPD must
provide fire protection and emergency medical services to
Hamilton Field without contractual agreements.
' The parties agreed that NFPD would provide fire protection for
Hamilton Field in return for compensation to paid to an escrow
account pending the resolution of the controversy.
15a
DISCUSSION
I. Legal Standard
To withstand a motion for summary judgment, the
Opposing party must set forth specific facts showing that
there is a genuine issue of material fact in dispute. See Fed.
R. Civ. P. 56(e). A dispute about a material fact is genuine
“if the evidence is such that a reasonable jury could return a
verdict for the non-moving party.” Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986). If the nonmoving
party fails to make a showing sufficient to establish the
existence of an element essential to that party’s case, and on
which that party will bear the burden of proof at trial, “the
moving party is entitled to a judgment as a matter of law.”
Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).
In opposing summary judgment, plaintiff is not entitled to
rely on the allegations of his complaint. He “must produce at
least some ‘significant probative evidence tending to support
the complaint.”” 7.W. Elec. Serv. Inc. v. Pacific Elec.
Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987)
(quoting First Nat'l Bank v. Cities Serv. Co., 391 U.S. 253,
290 (1968)).
The Court does not make credibility determinations with
respect to evidence offered, and is required to draw all
inferences in light most favorable to the non-moving party.
T.W. Elec. Serv., Inc., 809 F.2d at 630-31 (citing Matsushita
Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587
(1986)). Summary judgment is therefore not appropriate
“where contradictory inferences may reasonably be drawn
from undisputed evidentiary facts... .” Hollingsworth
Solderless Terminal Co. v. Turley, 622 F.2d 1324, 1335 (9th
Cir. 1980).
II. Analysis
The United States argues that the detachment is invalid for
two reasons: because it is an unconstitutional attempt to
l6a
indirectly levy a tax on the Government, and because it was
approved in a manner that violated California law. NFPD
responds that the United States is barred from challenging the
validity of the detachment by a statute of limitation contained
in the California Code of Civil Procedure, and by the
doctrines of estoppel, waiver, and laches. The Court must
consider these threshold issues raised by NFPD before
turning to the Government’s arguments on the merits.
A. Threshold Issues
1. California Statue of Limitations
Under principles of sovereign immunity, the United States
is not generally subject to state statutes of limitations. See
United States v. State of California, 932 F.2d 1346, 1350-51
(9th Cir. 1991), aff'd on other grounds, 507 U.S. 746 (1993).
It must, however, follow state claim procedures that are “a
condition precedent to, or an integral element of” a state
cause of action. If the claim procedure is not followed, the
government never even acquires a cause of action. /d That
exception does not apply to this case because the six-month
limitation in the California statute relied upon by plaintiff is
not a claim procedure prerequisite to a cause of action, but
simply a standard statute of limitations. See Cal. Code Civ.
Proc. § 349.1 (legal acts relating to changes in territorial
boundaries of special districts “shall not be contested in any
action unless such action shall have been brought within six
months of the date of completion of said acts or
proceedings”). The Court therefore ‘holds that the
Government is not bound by the state statute of limitations in
this case.”
“ NFPD urges the Court to rely on United States v. City of
Leavenworth, 443 F. Supp. 274 (D. Kan. 1977), a case in which
the government, having failed to challenge an annexation within
the thirty-day period required by Kansas law, was held to be bound
(...continued)
17a
2. Laches, Waiver, and Estoppel
“The government is not subject to the defense of laches
when enforcing its rights.” United States v. Menatos, 925
F.2d 333, 335 (9th Cir. 1991). Although the Government can
be subject to the defense of waiver, it cannot waive its rights
through the unlawful actions of its agents or officers. See
United Stafes v. Fowler, 913 F.2d 1382, 1386-87 (9th Cir.
1990). As discussed below, the detachment in this case was
invalid under California law, so the Government was entitled
to receive the fire protection services without having to
contract for them. The Comptroller General has held that
where a local agency is requited to provide a service for free,
agencies of the government are not authorized to pay for
them. See Matter of: 9-l-] Emergency Number Fee,
Hillsborough County, Florida, 66 Comp. Gen. 385 (1987).
Inequitable though it may seem, the Government’s entering
into contracts for the past twenty years thus does not waive
its right to challenge the detachment.
NFPD also argues that the government is estopped from
asserting the invalidity of the Hamilton Field detachment. A
party claiming estoppel against the Government must have
detrimentally relied on the Government’s conduct, and must
have done so reasonably. See Heckler v. Community Health
Serv. of Crawford, 467 U.S. 51, 59 (1984). Estoppel is
inappropriate in this case because NFPD has not shown any
detriment it has suffered by entering into the contracts with
the Government for the last twenty years. It is not enough
for NFPD to assert that it will be harmed if it is now required
to provide the services for free, or that it may eventually be
forced to return the contract payments it has received. The
by that statute of limitation. The Court believes the result in City
of Leavenworth to be inconsistent with Ninth Circuit law, and so
cannot rely upon it.
18a
“inability to retain money it should never have received” is
not a sufficient detriment on which to base an estoppel. See
Heckler, 467 U.S. at 62-63. NFPD must show that it is
worse off than it would have been had the Government
insisted on free fire protection from the start, and this it has
not done. The Court therefore holds that the Government is
not estopped from challenging the validity of the detachment.
B. The Lawfulness of the Detachment
a Supremacy Clause
The United States argues that the detachment is an
unconstitutional tax on the Government because it was meant
to force the Government to pay for fire protection services
which it was entitled to receive for free. The Supremacy
Clause prohibits states from taxing the operations of the
federal government. See United States v. Allegheny County,
322 U.S. 174, 176 (1944). In support of its contention that
the detachment was an indirect tax, the government cites to
the “impartial analysis” printed on the ballot, and to several
contemporaneous documents, which state that the purpose of
the detachment was to obtain compensation for fire
protection services to areas for which no taxes were
collected. See Declaration of Gregory A. Wedner in Support
of Plaintiff NFPD’s Motion for Summary Judgment at 15,
26-27, 35-36. The Court, however, agrees with NFPD that
the detachment cannot be considered an attempt to impose a
tax. Discontinuing fire protection services to Hamilton Field
did not force the government to enter into the contracts with
NFPD. Faced with the detachment, the government could
have chosen, for example, to expand its own fire protection
capabilities. Because the detachment does not have the
compulsory character of a tax, the Court holds that it did not
violate the Supremacy Clause.
19a
: a California Law
The Government claims that the detachment was invalid
for two independent reasons: because it violated a
requirement that detachments be abandoned upon a majority
protest, and because it violated a requirement that elections
held in the area to be detached and the remainder of the
District be separately tallied. The Court agrees with the
Government on both issues:
a. Majority Protest Requirement
The Government asserts that the detachment was required
to be withdrawn in the face of the Government’s written
protest of August 1977. In discussing this issue, the parties
appear to be relying on different versions of former section
56316 of the Government Code, which governed majority
protests. In 1970, California law was amended so that it
provided in pertinent part:
A majority protest shall be deemed to exist and the
proposed annexation or detachment shall be
abandoned if the board of directors shall find and
declare by resolution that written protests filed and
not withdrawn prior to the conclusion of the hearing
represent: (a) in the case of the annexation or
detachment of inhabited territory,
(1) more than 50 percent of the assessed
value of the land therein, or
(2) more than 50 percent of the voting power
of voters entitled to vote as a result of residing in or
owning land within such territory.
1970 Cal. Stat. Ch. 953 § 1. In 1977, the legislature again
amended this provision, essentially removing subprovision
(a)(2), with the result that the new statute permitted a
majority protest for inhabited land to be filed only by voters,
not landowner-voters. See 1977 Cal. Stat. Ch. 90 § 6. That
amendment was approved by the Governor and filed with the
20a
Secretary of State on June 2, 1977, after the detachment
proceedings had begun but before the Government filed its
written protest in August, 1977. Under Article 4, section 8 of
the California Constitution, however, the 1977 amendment
did not take effect until January 1, 1978. At the time the
Government filed its protest, therefore, the governing law
was the 1970 version of section 56316.
Given that the Government owned all of Hamilton Field,
its protest represented more than half the assessed value of
the area to be detached, satisfying the requirement of section
56316. Because the proposed detachment could therefore not
legally continue, the Court holds that the detachment was
invalid.
b. Separate Tally Requirement
The Government also argues that the election confirming
the detachment violated California law because the votes of
the residents of Hamilton Field were not tallied separately
from those of the residents of the rest of the district. The
relevant section, former California Government code section
56252, provided for elections held “(a) Only within the
territory ordered to be annexed or detached; or (b) Both
within the territory ordered to be annexed or detached and
within all or such part of said district as is outside of such
territory.” 1965 Cal. Stat. Ch. 2043 §2. Section (b) is
ambiguous: it could be read to refer either to a single
election held both inside and outside the detached area, as
actually occurred, or to separate elections inside and outside,
as the Government asserts should have occurred.
Former California Government code section 56324
suggests that the Government’s reading is correct. As
revised in 1970, that section read in pertinent part that:
The board of directors shall adopt a resolution
confirming the order of annexation or detachment, if
|
|
2la
a majority of the votes cast upon such question are in
favor of such annexation or detachment:
(a) At an election called only within the
territory ordered to be annexed or detached; or
(b) At each election where one election was
called within the territory ordered to be annexed or
detached and another election within all or such part
of said district as is outside said territory.
1970 Cal. Stat. Ch. 953 § 2. This reference to two separately
tallied elections strongly suggests that section 56252(b) also
referred to two elections.
The case of Simi Valley Recreation and Park Dist. v.
Local Agency Formation Comm'n of Venture County, 124
Cal. Rptr. 635 (Cal. Ct. App. 1975), does not suggest
otherwise. In that case, the commission chose, pursuant to
56252(a), to hold an election only within the territory to be
detached, which had only five residents, and not within the
rest of the district, which included the relatively populous
town of Simi Valley. See id at 641, 657. After the five
voters approved the detachment, the plaintiffs challenged the
commission’s decision on the ground that it
unconstitutionally deprived Simi Valley residents of their
right to vote on the detachment. See id. at 653. In the course
of rejecting that argument, the court considered what would
have occurred had the election instead been conducted under
56252(b). The court stated that in view of the population
disparity between the detached area and the rest of the
district, “an election which included the residents of the
remainder of the district would have been one in which the
selfish interest of such residents would wholly determine the
result.” Jd at 657. This passage does not aid the Court in
construing section 56252(b), for in Simi Valley the remainder
of the district would have controlled the outcome of the
election under either construction: If the elections had been
tallied separately they would have vetoed the detachment in
22a
their separate election, and if the elections had been tallied
together they would have achieved the same result simply by
overwhelming the five votes from the area proposed to be
detached.
The Court therefore holds that former section 56252(b)
required separately tallied elections in the area to be detached
and the remainder of the district. Because such a vote did not
occur in this case, the detachment was confirmed by a
process that violated California municipal reorganization
law, and is invalid.
CONCLUSION
For the foregoing reasons, the Court DENIES plaintiffs
motion for summary judgment, and GRANTS defendant’s
cross-motion for summary judgment. Judgment shall be
entered in accordance with this order. Further, the United
States is ORDERED to show cause why its claim against the
City of Novato should not be dismissed as moot, and the City
of Novato is ORDERED to show cause why its claim against
the NFPD and the United States should not be dismissed as
moot. The United States and the City of Novato shall file
their responses no later than fen days from the date of this
order.
SO ORDERED.
Dated: January 7, 1998
s/Fern M. Smith
FERN M. SMITH
United States District Judge
23a
APPENDIX C
NOT FOR PUBLICATION
FILED
SEP 22 1999
CATHY A. CATTERSON, CLERK
U.S. COURT OF APPEALS
NOVATO FIRE PROTECTION No. 98-1544]
DISTRICT(“NFPD”),
D.C. No. CV-96-
Plaintiff-Appellant, 03893-FMS
V. ORDER
UNITED STATES OF AMERICA;
U.S. COAST GUARD,
Defendants-Appellees
Before: WOOD!, THOMPSON, and THOMAS, Circuit Judges.
The panel has voted to deny the petition for rehearing and
to reject the suggestion for rehearing en banc.
The full court has been advised of the suggestion for
rehearing en banc, and no judge of the court has requested a
vote on the suggestion for rehearing en banc. Fed. R. App. P.
35(b).
The petition for rehearing is denied and the suggestion for
rehearing en banc is rejected.
' The Honorable Harlington Wood, Jr., Senior United States
Circuit Judge for the Seventh Circuit Court of Appeals, sitting by
designation.
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.