Defendants, City of Romulus, County of Wayne, and Romulus Community Schools, (hereinafter defendants) appeal as a matter of right from an order of summary judgment in favor of plaintiff in an action brought to recover taxes paid under protest to defendants.
Plaintiff, Avis Rent-A-Car System, Inc, is a foreign corporation which operates a car rental concession at Metropolitan Airport, located in the City of Romulus, County of Wayne, Michigan. Plaintiff had entered into an agreement dated September 16, 1966 with the Board of County Road Commissioners of the County of Wayne, under the terms of which plaintiff was granted "the right to conduct and operate an exclusive 'drive-it-yourself Automobile Rental Concession, in common with two others, at the Airport, for the convenience of the traveling public”. Pursuant to said agreement, plaintiff constructed four rental counters, two "pick-up” areas on airport property, and a service building on the airport grounds which was, leased fi:om the County Road Commissioners. It is the status of the service building for. tax purposes which has been the subject of continuing litigation between the parties.
In 1966, Romulus Township sought to tax Avis for the "user or lessee portion” of the service building site pursuant to MCLA 211.181; MSA 7.7(5). Avis commenced suit against the Township in 1967 seeking a declaratory judgment that the site was tax exempt under the statute as a "use * * * by way of a concession in or relative to the use of a public Airport, park, market, fairground or similar property which is available to the use of the general public * * * ”.
During the litigation the Michigan Supreme Court decided the case of
Kent County v Grand
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Rapids,
Late in 1971, the City (formerly Township) of Romulus sought to levy a tax on plaintiffs service building as "personal property”. Again, plaintiff filed suit and brought a motion for summary judgment, on the ground that the provisions of the general property tax act, upon which Romulus sought to levy a personal property tax on a service building site had been declared unconstitutional by the Michigan Supreme Court in
Continental Motors Corp v Muskegon Twp,
Meanwhile, efforts by the City of Romulus to persuade the Michigan Legislature to amend the applicable statute proved successful. The amendment,
"(2) In counties of over 1,000,000 in order to determine whether a lessee or user at an airport is a concessionaire within the provisions of this act, and whether *123 the use of real property used in connection with the concession operation is essential to the concession operation so as to come within the exception contained in this act, it is required that the following basic tests be met:
"(a) It shall have the exclusive right and duty to render a necessary or customary service, based on a contract entered into requiring that it render goods or services either to the grantor or to the general public on behalf of the grantor;
"(b) The service rendered must be available to the general public on a nondiscriminatory basis;
"(c) Use of real property in connection with a service concession must be a necessary and integral part of the concession operation.”
The enactment of
The Michigan Legislature in 1945 enacted the Michigan Aeronautics Code, MCLA 259.1
et seq.;
MSA 10.101
et seq.,
for the purpose of furthering "the public interest and aeronautical progress”. The act provided for the creation of the Michigan Aeronautics Commission and the Michigan Department of Aeronautics charged with the duty,
inter
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alia,
of developing a state-wide system of airports.
In 1953 the Michigan Legislature enacted
From the foregoing excerpts from Michigan statutes, the public policy of this state regarding aeronautics is clear. Since the development of aeronautics is considered to be very much in the public interest, safe and convenient air travel is to be encouraged. Airport development is to be fostered by the use of matching funds and by providing tax incentives to encourage businesses to provide necessary customer services for the convenience and comfort of air travellers. By its most recent act,
Plaintiff argues that
"The Legislature should pass no local or special act in any case where a general act can be made applicable, and whether a general act can be made applicable shall be a judicial question.”
The parties agreed that a population classification which limits the present application of a legislative act does not make the act local or special if the population classification bears a reasonable relationship to the purpose of the statute and the statute applies whenever the population classification is met. See
Airport Community Schools v State Board of Education,
We fully agree with the well-reasoned opinion of the circuit judge, and we quote at length and with approval therefrom.
"This Court can see absolutely no reasonable relationship between the population of a county in which an airport is located and the entitlement of a concessionaire in that airport to tax exempt status under Act 189. As this Court stated in its 1970 Opinion, the entire *126 purpose of Act 189 seems to be to encourage the development of airports. Obviously, the Board of County Road Commissioners deemed it essential to have Avis as a concessionaire at the Airport, and this Court earlier observed that, in this day and age, a car rental concession is a necessity for the efficient operation of a large municipal airport.
"The effect of Act 174, however, is to discourage airport development in heavily populated areas, the very areas that most need such development. Compare Wayne Circuit Judges v Wayne County,383 Mich 10 [172 NW2d 436 ] (1969), and Wayne County [Board of Review] v Great Lakes [Steel] Corporation,300 US 29 [57 S Ct 329 ;81 L Ed 485 ] (1937).
"Failing to reply to plaintiff’s argument that state policy is to encourage airport development in the state’s most populated areas, Romulus seeks to justify the exception of Act 174 on an economic basis. In its brief, Romulus cites statistics dealing with airport traffic, and argues that, in airports with substantial traffic, such as Metropolitan Airport, concessionaires will locate with or without tax exemption, whereas in airports of less traffic, the need for a tax exemption is present.
"Whatever the economics of locating at airports may be, it is clear to this Court that Romulus has, by its argument, proved the inherent defect in Act 174. This is made clear by the fact that there is no correlation between the county in which an airport is located and the traffic which passes through the airport. An example suggested by Avis brings the point home. Plaintiff presents an affidavit of the assistant manager of Willow Run Airport, to which is attached a map of the airport itself. The affidavit and map disclose that the terminal facilities at Willow Run Airport (which, of course, was the principal public commercial airport prior to the development of Metropolitan Airport), are located in Washtenaw County, whereas the runways, etc. are located in Wayne County. Since Willow Run was once the busiest airport in this state, it would, under defendant’s theory, attract concessionaires without a tax exemption. But, since its terminal is in a county with under one million people, Act 174 would nevertheless give those concessionaires that very exemption!
*127 "Whereas Romulus tries to justify Act 174 on important differences among airports based on traffic, Act 174 is not at all directed to traffic, but to county population, which is quite another thing.
"The Court is particularly mindful of the decision in Great Lakes Steel Corporation v Lafferty,12 F Supp 55 (E.D. Mich 1935), where a three-judge federal district court held unconstitutional a state statute abolishing township boards of review, except in counties having a population of more than 500,000. The court there held that the statute was obviously directed only at Wayne County, but that size and population did not present a peculiar need for taxation purposes. Particularly appropriate here is the following quotation from Judge Tuttle, speaking for the court, as follows:
" '[T]he only county in Michigan having a population of more than 500,000 is the defendant county of Wayne, whose population according to the last federal census was 1,888,946; the next most populated county in the state being Kent county, with a population of 240,511. Hence, it is obvious that this statute was intended by the Michigan Legislature to be applicable only to Wayne county, at least for many years to come. The question, therefore, presented in this connection is whether there is such a difference, resulting from population, between Wayne county and the other eighty-two counties in Michigan, as affords a reasonable basis for the difference, prescribed by this statute * * * and after careful consideration of the numerous extensive, and exhaustive briefs of the parties, we are unable to ñnd any such difference, or any reasonable relation between the population of Wayne county, as distinguished from that of the other counties in the state, and the object of this statute. ’(Emphasis added.)
"This Court can see no reasonable relationship between county population and the appropriateness of tax exemption. In keeping with a long line of cases cited above and many others cited in plaintiff’s brief, the Court agrees with the plaintiff here that Act 174 violates Article IV, § 29 of the Michigan Constitution, and is, therefore, invalid.”
Defendant school district argues that the popula
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tion classification effectively "singles out” Metropolitan Airport for special treatment. We disagree. We take judicial notice of two other municipal airports in Wayne County, neither of which are comparable to Metropolitan Airport. We refer to Detroit City Airport and Grosse lie Municipal Airport. Detroit City Airport serves the needs of the public in small commuter airlines, charter services, flying schools, corporate and business aircraft, and the various other needs of general aviation. Grosse He Municipal Airport, using the facilities of the former Grosse He Naval Air Station, is much smaller, and serves general aviation needs in the Detroit downriver area. We do not think that the legislative purpose of encouraging the development of airports is served by a statute which would tend to discourage the development of Detroit City and Grosse He Municipal Airports or similar airports in counties which in the future exceed 1,000,000 population. We think the Legislature by
Plaintiff further contends that
Uniformity of taxation as required by the Michigan Constitution means that the Legislature may
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not treat differently for tax purposes things which are essentially the same. See
Teagan Transportation Co v Board of Assessors of Detroit,
'"The rule allowing classification for purposes of taxation is always coupled with the proviso 'if all of the same class are taxed alike.’ Discrimination between persons or property in like situation cannot be effected by classification, since there can be no reason therefor. Omissions from a class, of subjects that clearly belong to such class, makes the classification invalid.”
The Michigan Supreme Court has held in substance that legislative classifications must be based upon substantial and natural differences which reasonably suggest the propriety of different treatment. See
Palmer Park Theatre Co v City of Highland Park,
While we do not have a legislative history to assist us in determining legislative intent, it would seem that in drafting
We think that the circuit judge was correct in determining that
Affirmed.