150 A. 293 | Pa. | 1930
Jenner Township, in Somerset County, is of the second class, as defined by the Code of 1917. To permanently improve its roads, in 1926, it borrowed the sum of $30,000, secured by bonds payable in ten years, and, *111 as provided by the Act of April 20, 1874, P. L. 65, supplemented by later legislation, filed a financial statement in the court of quarter sessions. At the same time the municipal authorities levied an annual tax of one and one-half mills to pay the interest and provide a sinking fund sufficient to retire the debt at maturity, — action required by article IX, section 10 of the Constitution. These securities were sold in due course and are outstanding valid obligations of the township. The sums required for their extinguishment must be annually collected, and no attempt to deprive the holders of this fixed right could be sustained, if attempted.
By the Act of July 14, 1917 (P. L. 840, section 420), the supervisors of such townships are directed annually, before the organization meeting in December, or as soon thereafter as practicable, to make a written estimate of the funds needed for corporate purposes during the ensuing year, and file the same with the treasurer. The sum needed for current expenditures, including that required for the payment on account of debt already incurred, is thus fixed and the total must not exceed the amount receivable by the collection of a ten-mill tax. To meet unusual requirements, section 421 of the Code, as amended in 1921 (May 20th, P. L. 959), provides that "the board of supervisors, by unanimous action, shall, upon due cause shown, petition the quarter sessions, in which case the court may order a greater rate, but not exceeding ten additional mills to be levied." By the same section of the Code, permission is given to collect, without special leave, further sums for the upkeep of a lockup, and town-house, or to support a lighting system, but these clauses have no bearing on the present controversy.
The annual expenditure required for the interest and sinking fund of the bonds outstanding, and already determined in amount, constitutes a debt, which must be provided for in the total yearly estimate, as directed by paragraph (d) of section 420, already noted. The one *112
and one-half mills necessary for this purpose must be paid, having already been set apart for this use, as required by the legislation permitting the creation of municipal indebtedness, and only the balance of the tax collected can be appropriated for other purposes. It was said in Georges Twp. v. Union Trust Co.,
"It is a principle universally declared and admitted that municipal corporations can levy no taxes, general or special, upon inhabitants, or their property, unless the power be plainly and unmistakably conferred": 4 Dillon on Municipal Corp. 2398. And the grant of such right is to be strictly construed, and not extended by implication: Com. v. P. R. T.,
The special levy legally required at the time of the creation of the debt for the purpose of paying the interest and retiring the bonds at maturity was assessed in 1926, — action essential to the validity of the securities. As was said in Rainsburg v. Fyan,
It is urged that the two levies are separate and distinct, the proceeds of the one to be expended for general purposes, and the other to be used to liquidate the bonded indebtedness, for which an annual tax was, by *114
resolution, provided at the time the securities were issued in 1926, and, therefore, both may be collected. This overlooks the fact that the debt charge is to be included in the annual estimate, which sum cannot exceed an amount that will be liquidated by a tax collectible on a ten-mill basis, without special allowance, except in certain instances mentioned and not applicable here. If it is made apparent that the moneys receivable, on the basis fixed, will be insufficient, the court may allow an increase, or even compel, by mandamus, the levy of a special tax to meet an emergency or to provide for some unexpected deficiency: Township Code, section 422 (supplanting the Act of March 31, 1864, P. L. 162, referred to in Lehigh C. N. Co.'s Appeal,
The demand now in question was levied for 1929, and, therefore, subject to acts of assembly regulating municipal action then in force. Though the original tax for refunding was provided for in December, 1926, it became a debt to be provided for in the annual budget, as already noticed, and it is further to be noted that the Act of May 4, 1927, P. L. 707, directed, in express terms, that such a liability should be included in the yearly limited levy. The later legislation eliminates any possible doubt as to the meaning of the Code, when it added, to section 420, the words: "Such annual road tax shall include all levies for road purposes and for the payment of bonds andcertificates of indebtedness issued and all other debts incurred for road purposes." Without this enactment, the tax of 1926 to pay the bond interest and provide for the sinking fund, constituting as it did a debt charge, should have been included within the ten mills collectible, since the annual estimate, upon which *115 the tax limited in amount was based, required that provision should be made for existing indebtedness. Even if the inclusion of such item was theretofore questionable, the duty to so provide cannot be doubted since the Act of 1927 became effective.
A like question was determined, under analogous circumstances, where refusal to permit collection of a similar additional tax by a school district was sustained by this court in Gilberton Boro. Sch. Dist. v. Morris,
In the present case, the township has attempted to collect the full sum of ten mills and, in addition, the one and one-half mills provided for when the ten-year loan was authorized. The decision cited, though dealing with a school district, is controlling of the situation now presented, in which a township is defendant, the same general features appearing in the codes controlling both municipal corporations, though the maximum amount of tax collectible differs. Indeed, the right of the latter to make the attempted additional levy is less defensible, since all of its debt was necessarily included as part of the annual budget, not required of the former, under the School Code of 1911. It may further be noticed *116 that the wording of the Township Act of 1927, requiring that the provision for the bonded debt be included in the annual levy limited to ten mills, is more explicit than found in the Act of 1923, relating to school districts, and passed upon in the Gilberton Case referred to.
The decree of the court below is affirmed at the cost of appellants.