Kane County, Utah v. United States
17-739
| Fed. Cl. | Dec 15, 2017Background
- Kane County was eligible for Payments in Lieu of Taxes (PILT) under 31 U.S.C. §§ 6901–07 for FY 2015 and FY 2016; statutory formulas in § 6903 determine payment amounts and § 6902 obligates the Secretary to make annual payments.
- Congress appropriated insufficient sums for PILT in FY 2015 and FY 2016, producing pro rata reductions: Kane County received 89.6% of its FY2015 formula payment and 98.3% of its FY2016 formula payment.
- Kane County sued in the Court of Federal Claims seeking the unpaid portions for FY2015–2016 and moved for summary judgment on liability; the government moved to dismiss for failure to state a claim.
- Central legal question: whether the PILT statute or the FY2015–2016 appropriations limited the government’s obligation to the amounts actually appropriated (i.e., whether shortfalls relieve the Secretary of liability for formula amounts).
- The pre-2008 version of § 6906 contained language tying payments to appropriations and the Federal Circuit in Greenlee County held that that language limited liability to appropriations; Congress replaced that § 6906 language for FY2008–2014 but did not extend the replacement to FY2015–2016.
- The Court concluded that no current statutory or appropriations language limits the Secretary’s obligation for FY2015–2016, and therefore granted Kane County summary judgment on liability and denied the government’s motion to dismiss.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the PILT Act obligated full formula payments in FY2015–2016 despite insufficient appropriations | Kane: §§ 6902 and 6903 unambiguously require payments equal to the statutory formulas | Gov’t: appropriations (and pre-2008 practice) limit liability to amounts appropriated; legislative history or practice supports capping payments | Held: The statute (§§ 6902/6903) imposes an obligation; no text in the PILT Act or FY2015–2016 appropriations limits liability, so full formula obligation remains |
| Whether the pre-2008 § 6906 limiting payments to appropriations applies to FY2015–2016 | Kane: pre-2008 § 6906 was repealed/amended and does not apply to FY2015–2016 | Gov’t: failure to extend the 2008 amended § 6906 implies reversion to pre-2008 regime limiting payments | Held: Court rejects implied resurrection of repealed language; repeals/reenactments by implication are disfavored, so pre-2008 limiting language does not apply |
| Whether appropriations language or committee statements for FY2016 establish a binding limit on payment obligations | Kane: appropriations acts set dollar amounts only and legislative history cannot override statute | Gov’t: Chairman’s explanatory statement indicates intent to "fully fund" PILT via the appropriation, so payments capped | Held: Legislative history cannot add binding limits absent statutory text; the chairman’s statement does not create a statutory limitation |
| Whether deference to Interior regulation (43 C.F.R. § 44.51(b)) can justify pro rata reductions | Kane: regulation implemented the now-repealed pre-2008 regime and cannot override clear statutory text | Gov’t: regulation reflects agency interpretation that insufficiency permits proportional reductions | Held: Court finds statute unambiguous, so Chevron deference is not owed; the regulation cannot override the clear statute |
Key Cases Cited
- Lawrence Cty. v. Lead-Deadwood Sch. Dist. No. 40-1, 469 U.S. 256 (recognizing purpose of PILT statute)
- Greenlee Cty. v. United States, 487 F.3d 871 (Fed. Cir.) (interpreting pre-2008 § 6906 to limit PILT liability to appropriations)
- Prairie Cty. v. United States, 782 F.3d 685 (Fed. Cir.) (reaffirming Greenlee County interpretation)
- N.Y. Airways, Inc. v. United States, 369 F.2d 743 (Ct. Cl.) (rule: failure to appropriate does not alone defeat statutory payment absent modifying language)
- United States v. Langston, 118 U.S. 389 (statutory rights not abrogated by mere appropriations shortfalls)
- Chevron U.S.A., Inc. v. Nat. Res. Def. Council, Inc., 467 U.S. 837 (agency deference framework)
- Hui v. Castaneda, 559 U.S. 799 (repeals by implication disfavored)
- United States v. Fausto, 484 U.S. 439 (same principle against implied repeal)