State v. Garg
2012 ND 138
| N.D. | 2012Background
- Hale filed suit in Aug. 2010 challenging statutes authorizing state and local economic development programs as violating N.D. Const. art. X, § 18 and related due process, equal protection, and takings provisions.
- Hale sought declaratory relief, injunction against public disbursements to private parties, and attorney fees; he argued funds are not for the support of the poor and thus violate the gift clause.
- The district court dismissed or granted summary judgment to the State entities, Minot defendants, and MADC, concluding statutes authorize economic development programs and satisfy the public purpose requirement.
- The district court held the economic development programs constitute an enterprise for a public purpose under art. X, § 18 and rejected Hale’s facial and as-applied challenges.
- Hale appealed, and the court treated the memorandum decision as a final order with jurisdiction to review.
- This Court affirmed, holding that statutorily authorized economic development programs constitute an enterprise for a public purpose and are facially constitutional.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether economic development statutes violate gift clause art. X, § 18 on their face | Hale asserts statutes violate gift clause by gifting funds to private entities. | State entities argue statutes authorize enterprise for public purpose and are constitutional. | Facial constitutionality upheld; statutes authorize enterprise for public purpose. |
| Whether economic development programs constitute an enterprise under art. X, § 18 | Hale contends programs are not direct engagements in enterprise. | Defendants contend programs fit enterprise as authorized by gift clause interpretation and Haugland. | Programs constitute an enterprise under art. X, § 18. |
| Whether economic development as applied violates due process/equal protection/takings | Hale claims lack of accountability, preferential treatment, and improper taking of taxpayer funds. | Defendants argue no specific disbursement outside authorized enterprises; claims are conclusory. | As applied claims rejected; conclusory assertions insufficient; no reversible error. |
Key Cases Cited
- Haugland v. City of Bismarck, 2012 ND 123 (ND Supreme Court (2012)) (enterprise interpretation of gift clause; public purpose and due process linkage)
- Gripentrog v. City of Wahpeton, 126 N.W.2d 238 (N.D. 1964) (public purpose requirement under gift clause)
- Wentz, 103 N.W.2d 245 (N.D. 1960) (historical gift clause interpretation of 'enterprise' and public purpose)
- Kelly v. Guy, 133 N.W.2d 853 (N.D. 1965) (public purpose concept under due process considerations)
- Leevers Supermarkets, Inc., 552 N.W.2d 365 (N.D. 1996) (public use/purpose framing in takings context)
- Teigen v. State, 2008 ND 88, 749 N.W.2d 505 (ND Supreme Court (2008)) (contract considerations not on point for enterprise/public purpose here)
- State v. Blunt, 2008 ND 135, 751 N.W.2d 692 (ND Supreme Court (2008)) (misapplication of entrusted property; not controlling for enterprise analysis)