133 Iowa 666 | Iowa | 1907
The city of Ft. Dodge, Iowa, after the usual preliminary proceedings, entered into several contracts with the Barber Asphalt Paving Company for paving certain streets or parts of streets in said city. Said contracts contained a provision 'by which the cost of the improvement was to be assessed against the abutting property, not to exceed in any ease twenty-five per cent, of the value of the property to be so charged, and the certificates of such special assessments or taxes were to be accepted by the contractor to the extent thereof, in payment for said improvements. It was also further provided that, in case such special assessments as thus limited proved to be less than the amount earned under the contract, the deficiency was to be “ paid out of the general paving fund of said city of Ft. .Dodge, by warrants drawn thereon.” Certain lots abutting on the improvements bélonged to the city, and the extent of the paving done included several street intersections. At the date of said contracts, there was in existence an ordinance of said city, providing that the cost of paving and curbing at the intersections of streets and of one-half of the paving of opposite property owned by the city or by the United States should be assessed against the property abutting or fronting upon the improvement proportion to the linear front feet abutting thereon, subject, however, to the same limitations that, the total charge of the special assessment should not exceed twenty-five per cent, of the value of the lot or tract upon which it was levied. Upon the completion of the work under these several contracts, it was found that, after assessing the abutting property in proportion to the special benefits it derived from the improvements, and limiting the liability of said property to twenty-five per cent, of its actual value, there remained a deficiency to the amount of several thousand dollars. To provide for this deficiency, and make payment to the contractors, the city council, by resolution, ordered that a levy be made therefor upon the taxable property of the city under the provisions
The appellants, who are residents and taxpayers in said city, bring this action in equity to declare the warrants so issued void, and to enjoin their collection. The claim thus asserted is based on the following propositions: First. That the city of Ft. Dodge, at the date of the several contracts above referred to, was indebted to thé full constitutional limit, and that said contracts had the effect to increase the corporate indebtedness beyond said limit, and were therefore void. Second. It is said that said contracts provided in their terms for the payment of the deficiency, if any, out of the general paving fund of the city of Ft. Dodge, while the warrants, payment of which is sought to be enjoined, were issued, not upon the general paving fund, but upon a special improvement fund. _ Third. Because, by the ordinance to which reference has already been made, the cost of paving street intersections and spaces opposite property owned by the city should have been apportioned to-the property benefited, and not made a burden upon the entire taxable property of the city. The trial court found against the appellants upon each of these propositions, and dismissed their petition.
It is to bo said also that the statement made by the appellant of the alleged indebtedness of the city includes several items not properly chargeable as outstanding indebtedness, and fails to take account of other items which should be deducted in such computation, and we are unable to see from the record that the city’s limit of valid indebtedness had in fact been reached. But, even if in error on this point, we think it is rendered immaterial by the further conclusion upon which we are entirely satisfied, that no indebtedness within the meaning of the limitation was created. Counsel say that, conceding the general rule that contracts for improvements to be paid by special assessments do not create a municipal indebtedness, yet, as the contracts in suit expressly contemplate a- possible deficiency, 'the city does to that extent assume the relation of a debtor, because the undertaking is not accompanied by any provision for raising the necessary revenue of which said obligation may be considered an allowable anticipation.
To uphold this proposition requires an unnecessarily narrow construction of the contract and of the statute. Counsel seem to concede that, if the agreement had by its terms provided for a collection of the deficiency upon the plan found in Code, section 830, their objection would 'be untenable. Assuming this to be the law we are of the opinion that the contracts came within its requirements. It was not possible to say in advance whether any deficiency would be found, or its amount if found. The most the city could do in this respect was to pledge itself to meet that contingency by some appropriate fund which it had the legal right to provide for that purpose. This it did. It may be admitted that the term “ paving fund ” used in one contract, and “ general paving fund ” in another, are
“Any city shall have power to levy annually the following special taxes. . . . (2) Improvement Fund. A tax not to exceed in any one year five mills on the dollar to be used for the purpose of paying' the cost of making, reconstruction or repair of any street improvements at the intersections of the streets, . . . and at spaces opposite property owned by the city or by the United States ” — and for other specified purposes. Turning next to section 830, we find it to read as follows: “Section 830.*672 Levy for City Improvement Fund. When the whole or any part of the cost of making or reconstruction of any street improvement shall be ordered paid from the city improvement fund to be levied upon all property within any city, it shall have the power after the completion of the work, by ordinance or resolution to levy at one time the whole or any part of the cost of said improvement upon all the taxable property within such city and determine the whole percentage of tax necessary to pay the same and the percentage to be paid each year' not exceeding the maximum annual limit of said taxes and the number of years, not exceeding ten, given for the maturity of each installment thereof but no part of such cost shall be levied against property owned by the city or by the United States.”
A careful reading of the language of the two sections above quoted makes it very clear that they do not provide for the creation of two distinct funds. Section 894, subdivision 2, allows the city to provide a “ city improvement fund ” by an annual levy not to exceed five mills on which warrants may lawfully be drawn for any of the specified street improvements or repairs. Section 830 contemplates a contingency where the expense of the improvement properly chargeable to such fund may be burdensome if payment is exacted at once, or may be in excess of the amount which can be raised by a single levy within the limit placed thereon by law, and provides that this condition may be relieved by levying the entire amount at once and making the tax or assessment payable in annual installments covering a series of years. The phrase, “ the city improvement fund,” is used in section 830 in a manner clearly indicating the thought in the mind of the Legislature that the law elsewhere already provides for a fund so designated or known. The fund described in section -894, subdivision 2, is the only one which fills this bill. It provides in specific terms for a “ city improvement fund,” and the purposes for which it is to be used are inclusive of or identical with the purposes
In short, section 830 does no more than provide how an excessive or burdensome demand upon the fund mentioned in section 894 may be provided for by a single present levy of the entire sum, payable in deferred installments, each within the statutory limits of such taxation, extending over a number of years. Hence, if appellants be correct in their contention that the phrase “ general paving fund ” should be construed to mean the fund contemplated by section 894, it follows that payment in the manner permitted by section 830 is in law and in fact a payment from said fund. The word “ general,” as used in the contracts, was evidently employed to indicate the appropriate fund which was to be raised by general taxation as distinguished from the amount to be raised by special assessments.
An examination of the entire record leads us to agree with the trial court that the appellants failed to present a case calling for the relief demanded, and the decree appealed from is therefore affirmed.