BUSE, and others, Petitioners, V. SMITH, and others, Respondents.
No. 75-552
Supreme Court of Wisconsin
November 30, 1976
247 N.W.2d 141 | 74 Wis. 2d 550
Argued May 5, 1976. Argued in response to June 11, 1976, order September 8, 1976.
[REDACTED] Whether or not the plaintiff can prove that it was engaged in such traditional educational activities as will differentiate it from Engineers & Scientists, supra, is to be determined at trial. The plaintiff has alleged explicitly that it was engaged in traditional educational activities; that it was unlike the organization in Engineers & Scientists; and has set forth the facts showing the differences. The amended complaint states facts sufficient to constitute a cause of action.
By the Court. - Order affirmed.
BUSE, and others, Petitioners, V. SMITH, and others, Respondents.
No. 75-552. Argued May 5, 1976. Argued in response to June 11, 1976, order September 8, 1976. - Decided November 30, 1976.
(Also reported in 247 N. W. 2d 141.)
For the petitioners there were briefs by L. C. Hammond, Jr., Michael J. Spector and Quarles & Brady, all of Milwaukee, and oral argument by Mr. Hammond and Mr. Spector.
For the respondents the cause was argued by John William Calhoun, assistant attorney general, with whom on the brief was Bronson C. La Follette, attorney general and Allan P. Hubbard, assistant attorney general.
A brief amicus curiae was filed by James L. Greenwald, general counsel for Wisconsin Education Association Council, of Madison; Richard S. Kohn and David C. Long, Lawyers Committee for Civil Rights under Law, of Washington, D. C., for Wisconsin Education Association Council; League of Women Voters of Wisconsin and Wisconsin Secondary School Administrators Association, Inc.
For the petitioners there was a reply brief in response to June 11, 1976, order by L. C. Hammond, Jr., Michael J. Spector and Quarles & Brady, all of Milwaukee, and oral argument by Mr. Hammond and Mr. Spector.
For the respondents the cause was argued by Allan P. Hubbard, assistant attorney general, with whom on the brief were Bronson C. La Follette, attorney general and John William Calhoun, assistant attorney general.
CONNOR T. HANSEN, J. We have fully considered the briefs, oral arguments and extensive appendix submitted by the respective parties, and the briefs of the several amicus curiae. It is our conclusion that the negative-aid provisions of school district financing, as mandated by
As pertinent to this action,
“121.07 General provisions; state aid computation. In this subchapter:
”
“(6) SHARED COST. (a) ‘Shared cost’ is the cost of operation, minus the operational receipts and amounts received under
s. 79.04(1) (c) , plus the principal and interest payments on long-term indebtedness and annual capital outlay, for the current school year. The sum of the principal and interest payments on long-term indebtedness and annual capital outlay included in shared cost shall not exceed $100 per pupil. Any amounts contributed by the school district to provide food service programs for the elderly shall not be included.“(b) In computing state aid for a school district, that portion of its shared cost per pupil which is more than 10% above the average per pupil shared cost for the previous school year [for school districts of like organization],1 as determined by the state superintendent, shall be excluded except as provided in par. (c).
“(c) In computing state aid on the shared cost excluded under par. (b), the secondary guaranteed valuation shall be used.
“(7) SCHOOL DISTRICT GUARANTEED VALUATIONS FOR DISTRICTS OPERATING BOTH ELEMENTARY AND HIGH SCHOOL GRADES. ‘School district guaranteed valuation’ is the amount set forth in pars. (a) and (b) multiplied by the number of resident pupils enrolled.
“(a) The primary guaranteed valuation shall be $71,200 in the 1973-74 school year and $75,500 thereafter.2
“(b) The secondary guaranteed valuation shall be an amount rounded to the nearest $100 determined by dividing the equalized valuation of the state by the number of pupils enrolled in the state.
”
“(10) MILL LEVY RATE. ‘Mill levy rate’ is the sum of the rates derived in pars. (a) and (b).
“(a) The primary required levy rate is the quotient of the shared cost not excluded by sub. (6) (b) divided by the school district primary guaranteed valuation.
“(b) The secondаry required levy rate is the quotient of the shared costs determined in sub. (6) (c) divided by the school district secondary guaranteed valuation.”
121.08 State aids; payments by certain districts. (1) The state shall pay to the school district a sum equal to the amount by which the primary guaranteed valuation exceeds the school district equalized valuation, multiplied by the primary required levy rate and a sum equal to the amount by which the secondary guaranteed valuation exceeds the school district equalized valuation multiplied by the secondary required levy rate.
“(2) The school district shall pay to the state the sum of pars. (a) and (b).
“(a) Beginning with the 1977-78 school year the amount by which the school district equalized valuation exceeds the primary guaranteed valuation, multiplied by the primary required levy rate.
“(b) The amount by which the school district equalized valuation exceeds the secondary guaranteed valuation, multiplied by the secondary required levy rate.
“(3) If the net amount computed under subs. (1) and (2) results in a negative sum, that amount shall constitute the negative aid payment due. The negative aid payment due shall be certified to the school district by the state superintendent on or before March 15. The school district treasurer shall transmit the amount certified to the state treasurer on or before May 15. The state treasurer shall credit this amount to the negative aid payment appropriation under
s. 20.255 (1) (k) . No negative aid payment shall be required under this subsection prior to the 1976-77 school year.”
In addition,
The foregoing statutes contain a district power equalization factor based upon the equalized valuation of real estate for taxation purposes located within each school district. As a result of the introduction of the district power equalization factor into the procedure for financing school districts, certain of the school districts in the
This is a class action, brought on behalf of all property taxpayers residing in negative-aid school districts and on behalf of all such school districts themselves. The petitioners are Glenn A. Busé, a property taxpayer residing in the Nicolet Union High School District, a negative-aid school district; other property taxpayers residing in other negative-aid districts; Joint School District No. 1, located principally in the city of West Allis; and other negative-aid school districts. A stipulated statement of facts has been submitted.
The two objectives are pursued concurrently by means of the aid formula set out in
Thus, the secondary guaranteed valuation per pupil figure serves as a built-in disincentive to spend above and beyond 110 percent of the state average per pupil shared cost for the previous school year. If a positive-aid district spends beyond this level, it will receive less aid. If a negative-aid district spends beyond this level, it will be required to pay more of its revenue to the state. The obvious aim of this secondary aspect to the formula is to encourage districts to remain close to the median state per pupil spending ceiling.
As the objective of the aid formula is to treat each school district as if its equalized valuation per pupil equals the state guaranteed valuation figures, the first computation is to determine the difference (positive or negative) between the state guaranteed valuation figures (both primary and secondary) and a district‘s actual equalized valuation per pupil. The district‘s equalized valuation per pupil is computed by dividing the full value of the taxable proрerty in the school district (as determined by
The positive or negative difference computed as above is then multiplied by the primary required mill levy rate, and the secondary required mill levy rate. The primary required mill levy rate is established by applying the provisions of
The secondary required mill levy rate is determined by the applying of the provisions of
The result of these computations determines whether a district is a negative-aid district and therefore pays a portion of its tax-generated revenue into the state fund or is a positive-aid district and receives payments from the state fund.
In applying these statutory formulas, two factors determine whether a particular school district is a negative-aid district which pays money to the state or is a positive-aid district which receives money from the state. First, how the actual equalized valuation of the district compares to the amount fixed by the legislature as the state primary guaranteed valuation per pupil and the secondary guaranteed valuation per pupil as determined by applying the statutory formula. Second, whether the district spends more or less in actual cost per pupil (teachers’ salaries, transportation, interest on long-term indebtedness, annual capital outlay, etc.) than the state primary shared cost ceiling.
The following are some of the results of application of the formula:
If the local district‘s equalized valuation per pupil is less than the state secondary guaranteed valuation per pupil, the district will always be a positive-aid district, whether its per pupil cost is less than or greater than the state shared cost ceiling. - If the local district‘s equalized valuation per pupil is less than the state primary guaranteed valuation per pupil but more than the state secondary guaranteed valuation per pupil, the district‘s status will be positive-aid until its per pupil cost is significantly greater than the state shared cost ceiling.
- If the local district‘s equalized valuation per pupil is equal to the state primary guaranteed valuation per pupil, it will receive no positive aid and will pay negative aid in proportion to the amount by which its per pupil cost exceeds the state shared cost ceiling.
- If the local district‘s equalized valuation per pupil is greater than the state primary guaranteed valuation per pupil, the district will always be a negative-aid district whether its per pupil cost is less than or greater than the state shared cost ceiling.
The power equalization objective of the aid formula is realized when the computed negative and positive aids are incorporated in a determination of the actual mill rate which a district will have to impose in order to achieve a desired actual cost per pupil. The intention is to achieve equal tax dollars for educational purposes (i.e., an equal actual cost per pupil) from equal tax effort. That is, any two school districts who choose to spend a given amount per pupil on education, will receive that amount, regardless of how much their actual equalized valuation per pupil differs, by taxing at the same mill rate.
The aid formula achieves its basic objective of district tax powеr equalization when viewed in terms of money spent per pupil. The formula purports to get equal tax
The new aid formula replaced Wisconsin‘s old “foundation plan” of educational financing which was in effect from 1949 to 1973. Under the former program a minimum or foundation valuation per pupil was guaranteed to the state‘s school districts. The state set a “guaranteed valuation per pupil.”
If the actual equalized property valuation per pupil in a given district was less than the statutorily provided guaranteed valuation per pupil, the state, from general state funds, provided the difference between the amount per pupil which the district actually raised by applying its mill rate to its own equalized valuation per pupil and the amount the district would have raised had its own mill rate been applied to the state guaranteed valuation per pupil.
Thus under the foundation plan, any district that was at or below the guaranteed valuation per pupil figure was roughly equalized in terms of taxing power with any other district similarly situated.
A district above the guaranteed valuation received no state aid under the above formula. Such a district, however, as well as below-guaranteed valuation districts, received a flat aid payment from the state, granted on a per-pupil basis. The foundation plan included no negative-aid requirements.
In reaching our conclusion in this case, we consider the following issues:
1. Are the negative-aid school districts barred from challenging the constitutionality of the new school aid formula?
3. Do
4. Is the negative-aid payment provided for in
5. Does the required negative-aid payment to the state fund of a portion of the tax revenues raised by a school district for redistribution by the state to positive-aid districts, violate
6. Is the negative-aid classification an unconstitutional infringement upon the rights of residents of negative-aid districts to due process and equal protection under the laws as provided by
STANDING.
The petitioners include five negative-aid school districts.
[REDACTED] The general rule is that a political subdivision of the state does not have the legal right or status as against the state or another state agency to contest the constitutionality of a statute. Columbia County v. Wisconsin Retirement Fund (1962), 17 Wis.2d 310, 116 N.W.2d 142; Town of Germantown v. Village of Germantown (1975), 70 Wis.2d 704, 235 N.W.2d 486. There are limited exceptions to the rule, but they are not here relevant. See Ful-ton Foundation v. Department of Taxation (1961), 13 Wis.2d 1, 108 N.W.2d 312, 109 N.W.2d 285; and Associated Hospital Service v. Milwaukee (1961), 13 Wis.2d 447, 109 N.W.2d 271.
[REDACTED] The establishment and operation of public schools is a governmental function of the state, and the legislature may and has delegated portions of that power to the various school districts. State ex rel. Wis. Luth. H. S. Conference v. Sinar (1954), 267 Wis. 91, 65 N.W.2d 43; School Dist. v. Burnett County School Committee (1952), 262 Wis. 484, 55 N.W.2d 874.
[REDACTED] [REDACTED] School districts, in exercising that delegated power, act as agencies or arms of the state, and thus under these circumstances, lack the standing to challenge the constitutional validity of these acts of the state. Joint School District v. State Appeal Bd. (1973), 56 Wis.2d 790, 203 N.W.2d 1; State ex rel. La Crosse v. Rothwell (1964), 25 Wis.2d 228, 130 N.W.2d 806, 131 N.W.2d 699.
[REDACTED] The other six petitioners are resident taxpayers in negative-aid school districts and parents of children who attend schools within those districts. They are directly affected in a financial and personal way by the enactment of the negative-aid provisions of the new school aid formula and thus they have standing to challenge its validity, both on their own behalf and on behalf of other taxpayers and parents-residents in negative-aid districts.
ARTICLE X, SEC. 3, WISCONSIN CONSTITUTION.
Article X, sec. 3, Wisconsin Constitution reads:
“District schools; tuition; sectarian instruction; released time. SECTION 3. [As amended April 1972] The legislature shall provide by law for the establishment of district schools, which shall be as nearly uniform as practicable; and such schools shall be free and without charge for tuition to all children between the ages of 4 and 20 years; and no sectarian instruction shall be allowed there-
in; but the legislature by law may, for the purpose of religious instruction outside the district schools, authorize the release of students during regular school hours. [1969 J.R. 37, 1971 J.R. 28, vote April 1972]”
The Wisconsin Constitution, unlike the
In the early case of State ex rel. Comstock v. Joint School District (1886), 65 Wis. 631, 636, 27 N.W. 829, this court stated:
“... The constitutional requirement is that ‘the legislature shall provide by law for the establishment of district schools.’ Inasmuch as there must be school districts before there can be district schools, and inasmuch as the school district system was in full operation in the territory when the constitution was framed and adopted, it is clear that section 3 of article X is a recognition of that system, and a mandate to the legislature to preserve and continue its essential features. . . .”
However, it is a fundamental rule that when dealing with the state constitution as contrasted with the federal constitution, the search is not for a grant of power to the legislature, but for a restriction thereon. Manitowoc v. Manitowoc Rapids (1939), 231 Wis. 94, 97, 285 N.W. 403; Outagamie County v. Zuehlke (1917), 165 Wis. 32, 35,
The “extent designated” was specifically set forth in
The respondents frequently advance the phrase “equality of educational opportunity.” All would agree this is an altruistic goal; however, so far as the state is concerned, its efforts toward such an objective must fall within the dictates of the criteria set forth in
As to the latter criteria, this court has held that when the legislature has provided for each child, the privileges of a district school, which he or she may freely enjoy, that constitutional requirement is complied with. See: State ex rel. Comstock, supra, p. 636. Equality of opportunity for education is equated with the right of all school children to attend a public school free of charge and without charge for tuition; although charges may be imposed for out-of-district residents, for vocational school training, and for certain incidentals. See: State ex rel. Comstock, supra; Manitowoc, supra; and Board of Education v. Sinclair (1974), 65 Wis.2d 179, 222 N.W.2d 143.
What the framers of the constitution intended the phrase “as nearly uniform as practicable” to mean was
“. An examination of the debates in the conventions that framed our present constitution and the constitution of 1846 (which contained a similar provision) discloses that the members of those conventions, when they were framing the article relating to schools, were concerned, not with the method of forming school districts, but with the character of instruction that should be given in those schools after the districts were formed, -with the training that these schools should give to the future citizens of Wisconsin.”
The same conclusion was expressed in Joint School Dist. v. Sosalla (1958), 3 Wis.2d 410, 420, 88 N.W.2d 357, and Larson v. State Appeal Board (1973), 56 Wis.2d 823, 827, 202 N.W.2d 920.
If “character of instruction” was all that was required to be “as nearly uniform as practicable” under the mandate of the constitution, then it was left up to this court to ultimately determine what subjects were to be included in “character of instruction” and to the legislature to determine what uniformity was “practicable.”
Pacyna v. Board of Education (1973), 57 Wis.2d 562, 204 N.W.2d 671, concerned the age of admission of children to kindergarten. It was there decided that all children of identical age should have an equal opportunity to enter public schools and that such uniformity was mandated by the constitution unless such uniformity throughout the state was found to be impracticable by the legislature. However, in arriving at that conclusion, this court stated at p. 564:
“Art. X, sec. 3, of the Wisconsin Constitution, provides a limitation upon the power and the authority of the legislature in the establishment of district schools. The article requires district schools to be ‘as nearly uniform
as practicable’ and to be ‘free and without charge for tuition to all children between the ages of 4 and 20 years.’ . . .”
The involvement of the legislature from the framing of the constitution to the present and the many cases which have come before this court, emphasize that the equal opportunity for education as defined by
To hold that the right to equal opportunity for education is a fundamental right under the Wisconsin Constitution and to hold that the legislature is constitutionally mandated to provide an equal opportunity for education as that term is defined by the criteria set forth in
We understand respondents to suggest that once the constitutional mandate to provide an equal opportunity for education is established, then it must follow that the means chosen by the legislature to accomplish that end, i.e., the school aid formula, is valid.
We cannot subscribe to such rationale. First, the phrase equal opportunity for education, as used above, is not an all inclusive phrase under which any action which moves toward such equality is immediately validated. That phrase is defined by words of the constitution-by the criteria set down in
In its interpretation of constitutional provisions this court is committed to the method of analysis utilized in Board of Education v. Sinclair, supra. The court will view:
(1) The plain meaning of the words in the context used;
(2) The historical analysis of the constitutional debates and of what practices were in existence in 1848, which the court may reasonably presume were also known to the framers of the 1848 constitution, see State ex rel. Zimmerman v. Dammann (1930), 201 Wis. 84, 88, 89, 228 N.W. 593, and State ex rel. Comstock, supra; and
(3) The earliest interpretation of this section by the legislature as manifested in the first law passed following the adoption of the constitution. Payne v. Racine (1935), 217 Wis. 550, 259 N.W. 437.
Whether absolute uniformity of an equal opportunity for education in all school districts of the state is socially desirable, is not for this court to decide. We can only conclude that the plain meaning of
Both petitioners and respondents presented excellent source material on the constitutional debates that preceded the adoption of the constitution, and on the historical background of education in the state.8 State ex rel. Comstock v. Joint School District, supra, recognized that the school district system was in full operation in the territory when the constitution was framed and adopted, and that
The first general law relating to the organization of common (district) schools was passed by the legislative assembly in 1839. This law was amended in 1840, and in 1841 there was enacted a comprehensive school law embodying the laws of 1839 and 1840. The 1841 law was further amended in 1843. These general laws had several common threads:
1. They created county, town, and school districts as subordinate units of the territory and delegated to these subdivisions powers in regard to the organization and maintenance of schools.
2. They created powers in the various county commissioners to levy property taxes for the maintenance of the schools.
3. They created powers in the electors of each town to levy property taxes for school purposes.
4. They set up a system inspection of the various schools. (Patzer, p. 7)
In 1845, a special school law was passed, authorizing the establishment of a free public school system in the village of Southport. Thus, impetus was given to the establishment of free schools in other parts of the territory, and to the shaping of public sentiment favoring a free public school system. (Patzer, pp. 14, 15) Yet the other essential characteristics of the school system, i.e., local control and funding, remained in effect.
In their adoption of
We cannot agree with the contention of the respondents that the mandate in
LOCAL CONTROL UNDER ART. X, SEC. 4.
The language of
Experience Estabrook, Chairman of the Constitutional Committee on Education and School Funds, expressed his rationale for the minimum local tax requirement of
“. . . It was intended that whatever the amount of the school fund might be, one-third of the expense of supporting schools, should be borne by each town. If a sufficient sum was not contributed by the school fund, the towns should have power to raise more. This provision was directly for the advantage of the poor. The gentleman who had last spoken, might not appreciate this; but a poor man with a family of children, and no fancy lots to dispose of, could understand the advantage. Experience had shown that if nothing was contributed by the town, the common schools languished, and select schools rose
on their ruins. The school fund of Connecticut was so large as to be sufficient to defray the expenses of the education of every child within the limits of the state. Yet there, until a year or two, the district school-system had declined. No adequate interest was felt by the people, in common schools, unless they contributed to their support. To obviate this danger, the committee had inserted the section.” Journal and Debates Constitutional Convention 1847-48, p. 335.
With the adoption of the constitution and the creation of the state, the subject of public education beсame an expressed concern of the state, with the state assuming the control of the establishment and operation of district schools. Respondents seem to argue that the very nature of the subject makes that power an unlimited plenary power over education.
While the state‘s power over education is extensive, there remains some local control.
In the forward to Coons, Clune and Sugarman, Private Wealth and Public Education (1970), at p. vii, Professor James S. Coleman described the basic competing forces underlying the development of education in America:
“THE HISTORY OF EDUCATION SINCE the industrial revolution shows a continual struggle between two forces; the desire by members of society to have educational opportunity for all children, and the desire of each family to provide the best education it can afford for its own children. . . .”
That the framers of the constitution recognized the importance of local interest and some measure of local control over local schools is evident from the statement of Experience Estabrook set forth herein.
Sec. 40 of ch. 19 of the Revised statutes of 1849 first manifested a construction of the state-local division of power in school matters when it empowered district boards to teach, in addition to those required subjects
The grant of power embodied in sec. 40, ch. 19, of the Revised statutes of 1849, and subsequent similar statutes could be termed a delegated power and not a constitutionally granted power. School districts are after all, but arms of the state, carrying out state duties. Nevertheless, the power to determine educational subjects over and above those imposed by the state is a necessary adjunct to the constitutionally granted power of localities to raise revenues for the support of schools therein,
Considering the expressed provisions of
Local districts retain the control to provide educational opportunities over and above those required by the state and they retain the power to raise and spend revenue “. . . for the support of common schools therein, . . .” (Emphasis added.) These rights of the local districts have their foundations in the constitution.
NEGATIVE-AID PAYMENTS; A TAX?
Both respondents and amici assert that the negative-aid payment provided for in
The only possible source of revenue for the required payments is the basic source of school district funds, i.e., local property taxes. See
Respondents confuse the purpose of the tax with the definition of the nature of state and local taxes. It is undisputed that education is a statewide concern and that money raised through the negative-aid provision will go toward the fulfillment of the state‘s duty to provide education. But to determine whether a tax is to be classified as a state or a local tax, one must look to the entity which directly levies the tax, and which in turn directly provides governmental benefits therefor. If that entity is the state, it is a state tax. If that entity is a political subdivision of the state, it is a local tax. The question is who directly (and not indirectly) levies the tax?
The funds paid to the state in the form of negative-aids can only be derived from revenues produced by taxes levied by the local district on property located within the negative-aid school district. The revenues from which these negative-aid funds are derived are raised by local taxes, not state taxes. The tax is a local property tax, locally levied, locally assessed and locally collected. For the last 128 years it has been locally spent for educational
Negative-aid payments are not part of the levy, assessment or collection of these district taxes, but they are part of the distribution and disbursements of the proceeds of these taxes. They are an integral part of the taxing process, and subject to those constitutional rules which relate to the distribution and disbursement of tax proceeds.
The parties concede that the state has the power to levy a statewide property tax for the purpose of supporting education, and in fact some form of such tax was in effect in Wisconsin from 1885 until 1933. However, the present statutory scheme vests the power of property taxation in local districts, and the taxes which they impose pursuant to this delegated power are local taxes, not state taxes.
RULE OF TAXATION UNIFORM, ART. VIII, SEC. 1.
At the time the briefs were filed in this case, there were 19 negative-aid districts in the state. Among them were k-8, 9-12, and k-12 school districts. Pursuant to
The respondents suggest the enactment is valid because: (1) There is a strong presumption of constitutionality; (2) public education is a matter of statewide concern; and (3) the purpose of the statutes are to insure equality of tax burden among the property taxpayers of Wisconsin. The latter would be achieved if all school districts in the state had the same spending level; thus
The levying of taxes constitutes the enforcement of proportional contributions from persons and property, levied by the state or municipality for the support of its government and its public needs. Fitch v. Wisconsin Tax Comm. (1930), 201 Wis. 383, 230 N.W. 37.
The genesis of the rules of taxation are found in
In Knowlton v. Supervisors of Rock County (1859), 9 Wis. 378 (*410), p. 389 (*420), it was stated:
“. . . Its mandate, it is true, is very brief, but long enough for all practical purposes; long enough to embrace within it clearly and concisely the doctrine which the framers intеnded to establish, viz.: that of equality. . . .”
Cooley9 states the general rule concerning the requirement of equality and uniformity:
“The requirement of equality and uniformity of taxation relates to the rate of taxation, the valuation for taxation, territorial equality, and, according to one view, the inclusion of all property as the subject of taxation. The rate of taxation must be the same, at least as to the same class. . . . The valuation must be based upon the same percentage, at least as to the same class of property . . . .
Knowlton, supra, pp. 387, 388, 389 (*419, 420, 421), also held:
“. . . This principle of justice and equality which requires that each person should contribute towards the public expenses his proportionate share, according to the advantages which he receives, lies at the foundation of our political system; and, in our opinion, it was to give to it a greater permanency and force, and to secure its more rigid observance, that the section above quoted was introduced into the constitution. We have already said that all are agreed that the levying of taxes by the properly constituted authorities of a county, city or town government, for their support, is as much an exercise of the taxing power as when they are levied directly by the state. . . . [T]here can be no uniform rule which is not at the same time an equal rule, operating alike upon all the taxable property throughout the territorial limits of the state, municipality or local subdivision of the government, within and for which the tax is to be raised. . . .” (Emphasis added.)
Gottlieb v. Milwaukee (1967), 33 Wis. 2d 408, 419, 147 N.W.2d 633, set forth the emphasized portion of the above stated rule and pronounced adherence to this interpretation of the constitutional provision here under consideration.
It is well established that there are certain inherent limitations and restrictions on the power to tax, particularly as they relate to territorial equality or uniformity. Cooley, supra, sec. 86, pp. 211, 212, states two of them to be: “. . . [the] inherent limitation on the power of the legislature to tax a local subdivision for a purely local purpose, or to compel such subdivision to tax itself for such a purpose. . . .” A state purpose must be accomplished by state taxation, a county purpose by county taxation, and a public purpose for an inferior district by
Wisconsin has long recognized this rule of constitutional interpretation, i.e., the purpose of the tax must be one which pertains to the public purpose of the district within which the tax is to be levied and raised. This court so held at least as early as State ex rel. New Richmond v. Davidson (1902), 114 Wis. 563, 576, 88 N.W. 586, 90 N.W. 1067, and in doing so, quoted extensively from Pennsylvania cases:
“. . . Thus, in an early Pennsylvania case it is held that:
“‘By taxation is meant a certain mode of raising revenue for a public purpose in which the community that pays it has an interest. The right of a state to lay taxes has no greater extent than this.’ Sharpless v. Philadelphia, 21 Pa. St. 148.
“In a later case in that state it is held that:
“‘An act authorizing the levy of contributions for a private purpose, or a purpose which, though public, is one in which the people from whom it is exacted have no interest, is not a law, but a judicial sentence, and not within legislative authority.’ Grim v. Weissenberg, 57 Pa. St. 433.
“So in that state it is further held that:
“‘The rule is, local taxation for local purposes, or taxation on the benefits conferred, but not beyond them. The legislature, by its general powers, cannot levy, or authorize a municipality to levy, a local tax for general purposes. Taxation exacts money or services from individuals as their respective shares of contribution to any public burden.’ Hammett v. Philadelphia, 65 Pa. St. 146.”
Davidson emphasizes that the theory of equality of taxation is that the taxpayer is compensated for the taxes he pays in some public purpose by the unit of government which imposes the tax.10 The equality, so far as prac-
In Lund v. Chippewa County (1896), 93 Wis. 640, 648, 649, 67 N.W. 927, the legislature authorized the state to receive funds for buying land and constructing a state institution in Chippewa county. Chippewa county responded to this legislation and rаised money by issuing bonds to be amortized out of future tax levies. The action of the county was challenged. This court found the legislation not to be violative of
The rule was repeated in Chicago & N. W. R. Co. v. State (1906), 128 Wis. 553, 661, 108 N.W. 557. In State ex rel. Owen v. Donald, supra, 126, 127, it was stated:
“There may lurk in the field of present protection to person or property or both, or, in what seems quite idealistic, a high moral duty to mankind, in general, without regard to place or time, the essential element of consideration, yet it must be remembered that even the demands of charity, springing from dire distress in some foreign jurisdiction, or any outside of the particular taxing unit, are not a legitimate basis for taxation of property in the particular jurisdiction, because of the absence of reciprocal obligations and benefits, in a governmental sense. State ex rel. New Richmond v. Davidson, 114 Wis. 563, 575, 88 N.W. 595, 90 N.W. 1067. ‘There
can be no legitimate taxation unless for the uses of the government’ levying it. 2 Dillon, Mun. Corp. (4th ed.) § 736.”
More recently, in State ex rel. Wisconsin Development Authority v. Dammann (1938), 228 Wis. 147, 183, 277 N.W. 278, 280 N.W. 698, the rule was simply stated as “It is the general rule applicable to appropriations that a tax must be spent at the level at which it is raised.” The same principle was subsequently enunciated in State ex rel. American Legion 1941 Conv. Corp. v. Smith (1940), 235 Wis. 443, 293 N.W. 161, and State ex rel. Warren v. Nusbaum (1973), 59 Wis. 2d 391, 208 N.W.2d 780.
Regardless of the merits of the legislative enactments or the worthiness of the cause, we conclude that the state cannot compel one school district to levy and collect a tax for the direct benefit of other school districts, or for the sole benefit of the state. The statutes here under consideration are violative of
DUE PROCESS AND EQUAL PROTECTION.
Petitioners argue that the negative-aid classification constitutes a deprivation of the due process and equal protection rights of the residents of negative-aid districts.
It has been established that the right to equal opportunity for education is a fundamental right guaranteed by the
The strict scrutiny standard should here be applied to the negative-aid classification. Petitioners contend that the negative-aid classification constitutes illegal discrimination against the residents of negative-aid districts in that: (1) The classification ignores the ability to pay of the residents of the negative-aid districts (age, average annual income, etc.); (2) the classification ignores the overburden of other municipal taxes which may exist in negative-aid districts; (3) the classification ignores the cost variations for factors of education, such as transportation, between districts, and (4) the classification creates a strong incentive for taxpayers in negative-aid districts, both consolidated and nonconsolidated, to spend less per pupil than taxpayers in positive-aid districts.
We are of the opinion that the classifications established thereunder would survive the strict scrutiny test. The first three factors are as likely to occur in positive-aid districts as in negative-aid districts and thus no claim of systematic discrimination against negative-aid districts may be heard in regard to them. The fourth factor is based upon speculation and conjecture, and thus will not serve as a basis to invalidate as unconstitutional, the law which establishes the classifications.
We are satisfied there is adequate justification for the classification sufficient to meet the requirements of the strict scrutiny test. The petitioners have presented no arguments nor advanced any authority which convinces us that any disincentives to negative-aid districts rise to the level of discrimination violative of the due process and equal protection rights of the residents of negative-aid districts.
We have considered and examined the authorities of other jurisdictions submitted by the respective counsel. The various school aid programs under consideration in those authorities are, we deem, significantly different from the one here under consideration, and, therefore, not of material assistance.
By the Court.—The negative-aid provisions of
ROBERT W. HANSEN, J. (concurring). Under which shell, state tax or local tax, does the pea of the negative state aid tax come to rest. For, even in the carnival version of the proverbial shell game, the pea has to end up under one of the shells. Since the tax is mandated and the amount of the tax to be locally collected is determined by the state, the writer, unlike the majority, would see the negative state aid tax as a state tax. As such, it is clearly unconstitutional since it violates the first requirement of uniformity1—the tax imposed being unequal as to similarly situated real estate in the state. Neither majority opinion nor dissenting opinion contend to the contrary.
However, even if the negative state aid tax is viewed as a local tax, as the majority holds, the writer joins the majority opinion to find such tax to be unconstitutional for the reason that, as the majority opinion states, the legislature “. . . has no power, against the will of the municipal corporation, to compel it to . . . assume obligations not within the ordinary functions of municipal government. . . .” (Quoting Lund v. Chippewa County (1896), 93 Wis. 640, 648, 649, 67 N.W. 927.)
The dissenting opinion seeks to meet the twofold requirement of uniformity—that the tax be uniform in rate within the taxing district and that it be levied for a
Our state constitution is not a grant of power, but a restriction on what would otherwise be an exercise of plenary power. (See: Manitowoc v. Manitowoc Rapids (1939), 231 Wis. 94, 97, 285 N.W. 403.)2 The test of whether a statewide public purpose is served does not replace the specific requirements of the Uniformity Clause in determining the constitutionality of a local tax. If we apply such “hand is quicker than the eye” shifting of the test, the specific restrictions and requirements of the state constitution become meaningless. Further, if uniformity as to rate on a statewide basis is not required, and, if the public purpose to be served is not limited to the public purpose of the taxing district, the constitutional requirement of uniformity of a state-imposed local tax is effectively repealed.
As to such local tax, the Uniformity Clause requires that the tax not only be uniform within the taxing district, but also that it be used for the public purpose of such local taxing district. The majority so concludes, and the cases cited support such conclusion. The writer
I am authorized to state that Mr. Chief Justice BRUCE F. BEILFUSS joins in this concurring opinion.
ABRAHAMSON, J., DAY, J. and HEFFERNAN, J. (dissenting). The majority opinion correctly concludes that the right to equal opportunity for education is a fundamental right under the
I.
This court has on numerous occasions stated that all legislative acts are presumed constitutional and that if any doubt exists it must be resolved in favor of the constitutionality of a statute. Our task is not to judge the merits of the statute or the wisdom of the legislature. Our task is to determine whether the statute clearly contravenes some constitutional provision. Gottlieb v. Milwaukee, 33 Wis. 2d 408, 415-416, 147 N.W.2d 633 (1967). See also School Dist. v. Marine Nat. Exchange Bank, 9 Wis. 2d 400, 403, 101 N.W.2d 112 (1960); State ex rel. Thomson v. Giessel, 265 Wis. 207, 215-216, 60 N.W.2d 763 (1953), 265 Wis. 558, 565, 61 N.W.2d 903 (1953); Chicago & N. W. Ry. v. La Follette, 27 Wis. 2d 505, 521, 135 N.W.2d 269 (1965).
As stated in Payne v. Racine, 217 Wis. 550, 561, 259 N.W. 437 (1935):
“Before a statute can be said to be unconstitutional, the statute must lack in public purpose ‘so clear and palpable as to be perceptible by every mind at the first blush.’ This was said by Chief Justice DIXON, who sat in the constitutional convention and helped frame the charter of our state. Brodhead v. Milwaukee, 19 Wis. *624, *652. ‘We must bear in mind,’ said Chief Justice WINSLOW, ‘the well-established principle that it [the statute] must be sustained unless it be clear beyond reasonable question that it violates some constitutional limitation or prohibition.’ Borgnis v. Falk Co., 147 Wis. 327, 348, 133 N.W. 209. ‘The rule of all courts,’ said Mr. Justice BARDEEN, ‘is that a statute will be declared unconstitutional only when it is shown beyond reasonable doubt that it conflicts with the fundamental law. It is equally true that the courts will seek every reasonable mode of reconciliation of the statute with the constitution, and it is only when reconciliation has been found impossible that it will be declared void.’ State ex rel. Hicks v. Stevens, 112 Wis. 170, 172, 88 N.W. 48.”
We do not believe that the majority has accorded this statute the proper presumption of constitutionality. It is not clear beyond reasonable question that the statute conflicts with the constitution. “If there was any doubt as to the power, duty would require us to resolve such doubt in favor of the validity of the act.” State ex rel. New Richmond v. Davidson, 114 Wis. 563, 579, 580, 88 N.W. 596, 90 N.W. 1067 (1902).
The majority concedes that equality of educational opportunity is a legitimate legislative goal, that a statewide property tax could be levied to support our schools, provided the rate is uniform, and that local districts should have some local control and some power to raise
II.
The majority holds that the statute in question violates
Several early Wisconsin cases interpreted the uniformity clause more broadly than merely territorial uniformity. These cases said that the uniformity clause required that taxes be levied and expended only for public purposes (in contrast with private purposes) and that a state-wide tax be levied only for a state-wide purpose, a county-wide tax for a county purpose and so on, down to the smallest unit.3
However, later cases of this court have categorized the principle that tax revenues be spent at the level at which they are raised as being part of the public purpose doctrine.4 This court has recognized that the public purpose
doctrine is a well-established limitation on the power of taxation, which is not derived from the uniformity clause or from any other specific constitutional provision.5 The public purpose doctrine is an inherent limitation on taxation which is variously attributed to the nature and form of our government, the reservations of
“. . . The theory of our government is, that socially and politically all are equal, and that special or exclusive, social or political privileges or immunities, cannot be granted, and ought not to be enjoyed. In consonance with this theory, that of taxation, whether as the subject of legislative action, judicial inquiry, or constitutional law, has always been that the burdens of supporting the government should be borne equally by all the individuals composing it, in proportion to the benefits conferred, and that the tax payer receives for the money exacted, a just compensation by the protection afforded his person and property by the proper application of the tax. This principle of justice and equality which requires that each person should contribute towards the public expenses his proportionate share, according to the advantages which he receives, lies at the foundation of our political system; and, in our opinion, it was to give to it a greater permanency and force, and to secure its more rigid observance, that the section above quoted [Uniformity Clause] was introduced into the constitution.”
The issuе for this court is therefore not a question of the application of the oft-interpreted uniformity clause—in the sense of territorial uniformity—which is clearly achieved in the statutes before us. The issue in this case is whether the “negative aid” statute violates the public purpose doctrine, the underlying aim of which is to protect citizens against an exercise of governmental power which is arbitrary and contrary to basic concepts of fairness and due process.7 In applying the public pur-
III.
The public purpose doctrine, as enunciated by the majority, has two aspects:
- The tax must be for a public—not a private—purpose.
- The purpose of the tax must be one which pertains to the public purpose of the district within which the tax is to be levied and raised.8
That education in the public schools is a public, not a private purpose, is conceded, and no more need be said.
The heart of the majority opinion is that the negative aids law violates the second part of the rule. The majority contends that the law compels “one school district to levy and collect a tax for the direct benefit of other school districts, or for the sole benefit of the state” in violation of
Petitioners rely heavily upon the 1952 Nebraska case of Peterson v. Hancock, 155 Neb. 801, 54 N.W.2d 85 (1952), to sustain their position. In Peterson a county Blanket Mill Levy was imposed upon the school districts within each county, but the law provided that a district with less than five students would not receive any funds from this levy after the first year of operation of the law. The purpose of this portion of the law was to effect the consolidation of small school districts. The Nebraska Supreme Court concluded that the law violated the constitutional principle here in question because it levied a tax upon districts with less than five students for the exclusive benefit and local purpose of districts with more than five students. Yet the tax in question was a county tax, and, in Wisconsin at least, the appro-
The public purpose limitation upon the tax power is not an arbitrary rule governing legislative power but is a doctrine of fairness whose purpose is to prevent fundamentally unjust and unfair exactions. The limited function of the judiciary in this regard must be kept firmly in mind, lest dicta and language used in prior cases be applied as if they and not the constitutional and inherent limitations on the legislature were the source of the doctrines to be applied. An analysis of the cases and the application of the rule to the specific fact situations will show that the negative aids legislation violates neither the public purpose rule nor this court‘s prior decisions.
Lund v. Chippewa County, 93 Wis. 640, 67 N.W. 927 (1896), and State ex rel. Board of Education of City of Oshkosh v. Haben, 22 Wis. 629 (*660) (1868), are cited by the majority for the rule the state could not require posed and the benefit received, as to amount to the arbitrary taking of property without compensation—‘to spoliation under the guise of exerting the power of taxing.‘” Dane v. Jacksоn, 256 U.S. 589, 599, 65 L. Ed. 1107, 41 Sup. Ct. 566, aff‘g 237 Mass. 50, 129 N.E. 606. Cooley on Taxation, sec. 89, p. 216 (4th ed. 1924).
In Rinder v. Madison, 163 Wis. 525, 158 N.W. 302 (1916), Dane County, pursuant to state law, levied a tax on all taxable property in Dane County for the county highway fund. The city of Madison objected to the tax on the ground that the county was levying a tax for the county highway system which excluded city streets. Thus the city residents objected that they were subjected to a tax conferring a benefit on residents of towns and villages, contrary to the rule of uniformity and equal protection of the law. This court upheld the tax. Taxation is not limited to property directly benefiting from the purpose for which the taxes are raised. The justice or injustice of the limits of the taxing district when fixed by the legislature cannot be questioned by the court. “The alleged injustice to residents of cities by compelling them to contribute to the improvement of highways located outside of their municipal territory presents no constitutional objections, and if actual inequalities of burdens result that is a subject for legislative consideration.” (p. 531)
Thus the proposition for which Lund, Haben and Tappan stand is that the state shall not use its power to impose a tax on one local government—rather than all locаl governments—for state purposes without the consent of the local entity. The imposition of an extra tax burden solely on taxpayers of one unit was declared invalid. The rule established was that all local units—all taxpayers—should make a contribution to support the state purpose.
The negative aid law in question here applies across the state to all school districts. No one school district is singled out to support another school district or state education. Thus the negative aids legislation is substantially different from the statutes in the cases cited by the majority, and the application of those cases to our question is therefore questionable. However, it is important to note that the negative aids law does not contravene the quoted black-letter doctrines set forth in these cases. No taxpayer is relieved of his proportional contribution to the support of education. The goal of the legislation is that all Wisconsin taxpayers shall contribute their fair share to the support of public education, and all will be, relative to any given spending level, equally burdened. The fact that the result of the negative aid provision will be that some but not all districts will pay negative aid is not grounds for its invalidation. The rules governing aid payments apply to all school districts alike which meet the terms and conditions of the statute. Cf. Joint School Districts v. Sosalla, 3 Wis.2d 410, 420, 88 N.W.2d 357 (1957); Columbia Co. v. Wisconsin Retirement Fund, 17 Wis.2d 310, 322, 116 N.W.2d 142 (1962); West v. Tax Commission, 207 Wis. 557, 564, 242 N.W. 165 (1932).
Accordingly, we conclude that the statute before us meets the test set forth by these cases that the state not
That expenditures are made outside the district do not render the appropriation invalid because such expenditures may still be a valid school district purpose.13 In Sharpless v. Mayor of Philadelphia, 21 Pa. 147, 171, 172 (1853), a case relied upon by the majority, the
“... Local taxes for local purposes, and general taxes only for purposes which concern the whole state, are a vital principle of our political system, and there is no feature in it which has attracted more unqualified admiration from those who understand it best. Its justice is too obvious to need explanation. . . .
“The city‘s charter was granted by the legislature. It may be enlarged. The same power which gave them the privileges which they have, may give them others. It cannot be so enlarged as to enable the corporate authorities to embark the city in a private business, or to make the people pay for a thing in which they have no interest. But within these limits there is nothing to prevent an indefinite extension of their corporate powers.
“But it is insisted that the right of a city or county to aid in the construction of public works, must be confined to those works which are within the locality whose people are to be taxed for them. The Water-Gap Company stops its road north of Vine street, outside of the city limits, and the Hempfield road has its eastern terminus at Greensburg, three hundred and forty-six miles west of Philadelphia. I have already said that it is the interest of the city which determines the right to tax her people. That interest does not necessarily depend on the mere location of the road. Therefore the location cannot be an infallible criterion. . . . A railroad may run through a county without doing its inhabitants the least service. May such a county assist to make it, while a city which it supplies with bread and whose trade is doubled by it must not do so, merely because it ends outside of an imaginary line that limits the corporate jurisdiction? It seems very plain that a city may have exactly the same interest in a road which terminates outside of her borders, as if the depot were within them, and a great deal more than if it passed quite through. If she has an interest in any
part, she has probably an equal interest in every part.” (pp. 171-172)
Even if there is a national or state interest, the courts have recognized that there can also be a local interest—which the local unit has in common with the whole state—sufficient to sustain or authorize the local tax. In Sharpless the court decided that the city had a special local interest in the improvements outside the city limits.
In Brodhead, supra, at p. 674 (*639-*640), it was argued that Milwaukee has no obligation to pay soldiers who entered the service of the United States. “They are not the soldiers of Milwaukee, but of the nation . . . . In what view, then, will taxation to pay these bounties be justified? Is its object to fill up the national armies and put down rebellion? This is not a matter of local оr municipal duty or concern.” This court upheld the law finding a municipal purpose although national and state interests were present.
These cases support the rule that a local interest, even one which a local unit has in common with the state, is sufficient to justify local taxation. The courts have repeatedly said that if the local unit has any such local interest, then the question of taxation is for the legislature and not for the courts. In Brodhead (p. 686, *652) this court said:
“. . . The objects for which money is raised by taxation must be public, and such as subserve the common interest and well being of the community required to contribute. To justify the court in arresting the proceedings and declaring the tax void, the absence of all possible public interest in the purposes for which the funds are raised must be clear and palpable—so clear and palpable as to be perceptible by every mind at first blush.”
In Sharpless, supra (p. 172), the Pennsylvania court similarly gave great weight to the legislative determina-tion if one could find any special local purpose.
If the majority (and petitioner) are saying that the payments to the state are invalid because property receiving no direct benefit from a tax for a particular purpose should not be taxed for that purpose, this position is not defensible. A citizen must pay a proportion of a school tax although he or she has no children. As Cooley on Taxes so aptly states:
“No system of taxation has yet been devised which will return precisely the same measure of benefit to each taxpayer or class of taxpayers in proportion to payment made, as will be returned to every other individual or class paying a given tax; and it follows that neither the federal nor state courts have power to revise the taxing system of a state for the purpose of attempting to produce a more just distribution of the burdens of taxation than that arrived at by the legislature.” (Sec. 89, p. 216)
The question then is whether there is a local public purpose which rationally justifies the legislative enactment requiring the local school districts to return some revenues raised by school taxes to the state.14
We conclude that the local property tax system which will result from the new formula, including the negative-aid provisions, does not violate the public purpose rule. We are unwilling to say that school districts, as a matter of constitutional law, have an absolute, unqualified right to the full revenues raised by the property tax within their districts.15
Secondly, we must determine whether the negative aids formula in fact compels one school district to contribute to a purpose confined to another district. As this court asked: “Can the citizens of Dane County be thus compelled to contribute to any public purpose
We believe the legislature has reasonable grounds to conclude that contribution by a school district to the Department of Public Instruction of part of its locally raised property tax revenue which shall then be distributed as state educational aids to schоol districts, is in the interest of and is germane to the purposes of the contributing school district.17 The taxpayers should not be heard to complain because a fraction of the taxes they pay for school purposes benefit the state‘s school system, of which the school districts in which they reside are a part.
School districts are merely quasi-municipal bodies and agents of the state for the purpose of administering the state‘s system of public education and have only such powers as are conferred upon them expressly or by necessary implication.18 Public education is a state, not a
It is true that school boards have a very large measure of local control, but it is the legislature, and not the constitution, which creates the specific dimensions of this local control.22 Over the years the legislature has encouraged local control of the educational system. Nevertheless each local school unit is not an isolated entity unto itself. Each unit must meet state requirements and is subject to the supervision of the Department of Public Instruction. Each unit is part of the whole state educational system.
We believe it an inevitable conclusion that the purpose of each school district is not only to educate its own children but also to participate in a state-wide educational
This was recognized as true of school districts in Ohio in Miller v. Korns, 107 Ohio St. 287, 140 N.E. 773 (1923). The statutes there involved had the effect of transferring a sizable portion of the property tax revenues of the school district in which the plaintiff resided out of that district for the benefit of other districts. A claim similar to that made here was raised:
“Plaintiff next contends that as the money rаised in Silver Lake village school district is taken out of that district and used in other school districts in Summit county, it is employed for a purpose foreign to the school district of Silver Lake village, and hence for a purpose which is not legitimate in taxation.” (p. 297)
In the course of rejecting this contention, the Ohio court said:
“. . . Silver Lake village school district shares in the advantages which will be derived from uniform excellence of schooling in Summit county and in the state of Ohio. The state purpose of having efficient schools throughout the borders of Ohio is a purpose not foreign to Silver Lake village school district nor to any other school district, but is one which, seen in the proper light, belongs to every school subdivision in Ohio.” (p. 299)
What was said of school districts in Ohio is equally true here.
Activities within a given school district are of interest and concern to and serve a purpose common to other districts. There is mobility of population and transfer of students; there is movement of children within the state and students attend school outside the school district of residence.23 Moreover one school district may provide
The legislature has created cooperative educational service agencies24 and has divided the state into CESA
“... designed to serve educational needs in all areas of Wisconsin and as a convenience for school districts in co-operatively providing to teachers, students, school boards, administrators and others, special educational services including, without limitation because of enumeration, such programs as research, special student classes, data collection, processing аnd dissemination, in-service programs and liaison between the state and local school districts.”26
The board of control appoints an Agency School Committee within each agency territory. The Committee is given the responsibility of studying and evaluating the existing school district structure
“... to determine if the goals of equal and improved educational opportunities for all children within the agency territory have been attained . . . and [to formulate] a plan to strengthen the administrative districts of the agency territory to operate a comprehensive school
program of offerings and services which meet the present and future educational needs of the children of the state and which can function with efficiency and at a justifiable cost to the local taxpayers and to the state.”27
Some might argue that the reasoning set forth above, pushed to its logical conclusion, means that every state benefit is of local concern and that any state direction for a local unit to turn over funds raised at the local level will therefore be valid. Such a conclusion does not necessarily follow from this opinion. In large part, it is the uniqueness of education among all public activities which supports this negative-aid system.
Notes
“It is quite impossible for us to perceive in what way it can be argued that this legislation violates the rule of uniformity in taxation of property. This rule was placed in the constitution for the protection of the taxpayer so that there may be no discrimination in property taxation. There is none here. The law does not change in the least the taxpayer‘s burden. He pays exactly the same tribute whether his whole tax contribution remains in the state treasury or whether part of it goes to the city treasury. He has not been taxed at one rate on a part of his property and at a higher rate upon another part . . . .
“It is equally difficult for us to see how this law can be in any sense called a law for the assessment or collection of a tax. It does not become effective for any substantial purpose until after the assessment and collection of the tax are fully completed. The processes of assessment and collection remain the same in operation and in effect as before.” State ex rel. Superior v. Donald, 163 Wis. 626, 628, 629, 158 N.W. 317 (1916).
“It is a maxim of the law that the power to appropriate is coextensive with the power to tax and so has fundamental and inherent limitations.
“The first of such limitations is implied from the very nature of organized society. That exists for public purposes of a governmental character. The scope of such purposes, it must be conceded, except as expressly or by necessary implication fundamentally limited, is quite broad.
“It follows that we need not, necessarily, depend on any fundamental limitations of the power to tax. There would be such if we had no constitution. Then, a tax could not properly be levied to take property from one person and give it to another.
“Public purpose and the character of the tax otherwise, would determine its legitimacy. A state-wide tax could only be levied for state-wide purposes and so on down to the smallest taxing district. In either case, the purpose would need to be public, in the sense of a matter of common or general interest to those
The reason this court has at times derived the public purpose doctrine from the uniformity clause is that the basic rationale of the uniformity clause is the same as that of the public purpose doctrine.
The uniformity clause guarantees that the burden of supporting government will be fairly and equitably ap-
upon whom the burden is laid.” State ex rel. Owen v. Donald, 160 Wis. 21, 124, 125, 151 N.W. 331 (1915).
See also: State ex rel. Bowman v. Barczak (1967), 34 Wis. 2d 57, 62, 63, 148 N.W.2d 683; Eich, A New Look At The Internal Improvements And Public Purpose Rules, 1970 Wis. L. Rev. 1115. State ex rel. Warren v. Nusbaum, 59 Wis. 2d 391, 413, 414, n. 8, 208 N.W.2d 780 (1972).
The needed protection against arbitrary legislative action may be found in the state and federal equal protection limitations. Newhouse, supra, pp. 601-608. “[T]he decisions of this court, as well as a half century‘s practical construction, reinforce the conclusion so strongly suggested by the constitutional debates . . . that the clause ‘The rule of taxation shall be uniform’ if applicable to excise taxation at all, means no more than the general equality clauses of the constitution, or ‘the equal protection of the law’ guaranteed by the XIVth amendment.” Nunnemacher v. State, 129 Wis. 190, 220, 108 N.W. 627 (1906). See also Judson, supra, note 4.
“It is undoubtedly the duty of the legislature which imposes or authorizes municipalities to impose a tax, to see that it is not to be used for purposes of private interest instead of a public use, and the courts can only be justified in interposing when a violation of this principle is clear and the reason for interference cogent. And in deciding whether, in the given case, the object for which the taxes are assessed falls upon the one side or the other of this line, they must be governed mainly by the course and usage of the government, the objects for which taxes have been customarily and by long course of legislation levied, what objects or purposes have been considered necessary to the support and for the proper use of the government, whether state or municipal. Whatever lawfully pertains to this and is sanctioned by time and the acquiescence of the people may well be held to belong to the public use, and proper for the maintenance of good government, though this may not be the only criterion of rightful taxation.” Citizens’ Savings & Loan Asso. v. Topeka, 20 Wall. 655, 664, 665, 22 L. Ed. 455 (1874).
“The rule that the benefits to the public must be direct and not remote and that the past course or usage of government is to be resorted to for guidance must in each case be considered in the light of the principle that the legislature has a very wide discretion to determine what constitutes a public purpose, and that courts will not interfere unless at first blush the act appears to be so obviously designed in all its principal parts to benefit private persons and so indirectly or remotely to affect the public interest that it constitutes the taking of property of the taxpayers for private use. It is to be observed that the tendency of later cases is toward greater liberality in characterizing taxes or appropriations as public in purpose.” State ex rel. Wisconsin Dev. Authority v. Dammann, 228 Wis. 147, 182, 277 N.W. 278, 280 N.W. 698, 709 (1938).
For cases in other jurisdictions indicating that local governmental units do not have complete fiscal autonomy over taxes raised within the unit, cf. School Dist. No. 12 v. Wasco Co., 270 Ore. 622, 529 P.2d 386 (1974) upholding ad valorem tax refunds to be paid by county though tax levied by and for benefit of single taxing district against contention of illegal imposition of burden on nonbenefitted districts; Intermediate School Dist. No. 105 v. Yakima Co., 81 Wash.2d 443, 503 P.2d 104 (1972) upholding statute requiring Yakima County to make office space available without rent to school district encompassing more than Yakima County against contention of violation of constitution that county taxes be expended only for county purposes; State ex rel. Woodahl v. Straub, 164 Mont. 141, 520 P.2d 776 (1974) upholding distribution of state educational funds raised through a general property tax against the contention that revenue must be expended in the county in which the revenue originates.
The respondent‘s brief notes that periodically the legislature has changed the boundaries of school districts, whereby territory from one district is detached and ordered attached to another district. Such orders have frequently been opposed on the grounds that the school district‘s valuation will decrease and that therefore their taxes will either increase or less money will be made available for education in that district. This court has rejected this argument holding that “whether the boundaries of a school district should be changed is not a question of law or fact for judicial determination, but is purely a question of policy, to be determined by the legislative department. . . . The courts have nothing to do with the policy, wisdom . . . of such matters....” Zawerschnik v. Joint County School Committee, supra, at p. 427. The state‘s conclusion that territorial changes and tax dollars being shifted, as in the case of negative aids, are comparable and are a constitutionally valid legislative function has merit.
“On July 1, 1965, Wisconsin‘s system of county superintendents of schools, elected by popular vote, came to an end. Successor to it in a redefined and altered role is a system of regional Cooperative Educational Service Agencies. . . .
“The geographical-political unit of responsibility for the county superintendency was the county. The agency‘s area of operational responsibility is a group of adjacent school districts, which in all cases embraces territory in two or more counties. At the time of their discontinuance there were 51 county offices in operation. The new regional agencies include all of the state‘s area in 19 units.
“For more than a century the county superintendent was a prominent figure in the affairs of Wisconsin Public Education. The statutes directed him to provide educational leadership, visit the schools, inquire into courses of study, keep informed in instructional procedures, advise school boards, advise teachers, certify valuation of school districts, make reports and investigations requested by the state superintendent and report the condition of the schools annually to the county board. Through the years a multitude of responsibilities associated with education and allied activities moved within the scope of the county office‘s activity, either by law, default or tradition.
“In reading the Wisconsin law which established the agencies, it seems reasonable to conclude that the rationale for agency existence and function assumes that there are services which are needed in the development of a complete educational program in a local district which cannot be realistically supplied by the independent effort of that district. Therefore, to provide these services only as identified and authorized by the officials of school districts, a coordinating regional office is provided by the state.
“This intermediate unit thus places school district officials in Wisconsin in the position of looking at education not only in terms of their local district‘s program. They now find themselves involved with officials of other school districts in consideration of educational programs which transcend school district lines. Such activity could be interpreted as a regional approach to supplying the educational needs of children.”