Plaintiff brought this taxpayer’s suit to restrain the city and county of San Francisco from appropriating $2,000,000 to purchase a parcel of real property at Fifth and Mission Streets, and to restrain all defendants from carrying out the provisions of an agreement 1 entered into between defendant Shoppers Downtown Parking, a corporation, and the city. Plaintiff appeals from the judgment in favor of defendants.
Questions Presented
1. Are the parking laws unconstitutional because of alleged arbitrary powers conferred upon the Parking Authority?
2. Is the agreement invalid ?
3. Does the procedure adopted to acquire the parking site violate the city charter?
4. Is a public off-street parking facility a public utility?
5. Are the findings supported ?
Facts
The city, by ordinance in 1955, appropriated $2,000,000 from the unappropriated balance of the 1947 Off-Street Parking Bond Fund, to acquire the above mentioned property for *359 a public off-street parking facility with a capacity of approximately 1,000 automobiles to be constructed and operated thereon. The site was designated and recommended to the board of supervisors by the parking authority of the city on the basis of studies and reports conducted over a period of approximately eight years and was approved by the board. February 28, 1956, the board adopted a resolution authorizing the acquisition of the property by eminent domain proceedings for a public off-street automobile parking site. July 24, 1956, the board passed a resolution authorizing the execution of an agreement between the city and Shoppers Downtown Parking, a nonprofit corporation. The substance of that agreement follows: (1) The city will acquire the above mentioned site. (2) The corporation will at its own expense construct thereon the garage facility required by the city and the title to the facility will vest in the city upon construction. (3) The corporation will finance the cost of construction by borrowing money, which loan will be evidenced by notes of the corporation designated as construction finance notes. (4) All the corporation’s stock will be placed in trust for the city. (5) The city will call for bids for an operating lease of the facility. The form of lease is attached to the agreement. The lease requires that the construction finance notes will be paid from the revenues of the project, whether the lease be awarded to the corporation or to some other person, firm or corporation. (6) The corporation is permitted to bid for the lease on the same footing as any other bidder, and agrees to submit a bid for the operating lease which will be equal to 100 per cent of the net receipts, i. e., the amount remaining at the end of each year after payment of the expenses of the facility and debt service upon the construction finance notes out of gross revenues. (7) The corporation shall have no recourse against the city for payment for the construction of the facility and agrees to look solely to payments made by the lessee upon the construction finance notes for reimbursement for such costs.
The form of lease provides: (1) a term of 50 years, subject to the right of the city to terminate the lease any time after the construction finance notes have been paid. (2) Lessee shall pay the indebtedness incurred by the corporation to finance the construction of the facility, as evidenced by the construction finance notes. (3) Lessee shall pay all gross receipts from operation of the facility to the bank which is authorized to disburse them as follows: (a) all amounts payable on account of the indebtedness incurred by the corpora *360 tion to finance construction; (b) to lessee, all normal and reasonable operating expenses, subject to examination, audit and approval of the city controller; (c) to lessee, all administrative and management expenses not to exceed $10,000 per year; (d) to the corporation, all monthly operating expenses such as franchise taxes, etc., approved by the city controller; (e) to the bank, for the account of the city the agreed percentage of the net receipts; (f) to lessee, the amount, if any, remaining. (4) The premises will be used solely for the operation of a public automobile parking facility and for the incidental sale of petroleum and petroleum products. (5) The rates and charges for parking will be established by the city from time to time, and, subject to modification by the city, an initial rate of 15 cents per hour is fixed.
1. Constitutionality of Parking Laws.
The claimed unconstitutionality of these laws is based primarily upon the contention that the Parking Authority provided therein is granted arbitrary powers and is a “legal Frankenstein.” These laws create in each city a public body corporate and politic known as the Parking Authority of the city. Such authority shall not function until the legislative body of the city by resolution declares that there is need for the authority to function therein. (The board of supervisors by resolution declared such necessity.) Sections 32800-32956, Streets and Highways Code, set forth the powers of the authority. They are many and broad. It is not necessary to detail them here. They are similar to, and, in many respects, the same as the powers granted the Housing Authority by the Housing Authorities Law and the Housing Cooperation Law.
2
These laws were held to be constitutional in
Housing Aiithority
v.
Dockweiler,
These cases demonstrate that the powers given the Parking Authority created by the parking laws are not “an unconstitutional delegation of executive, legislative and judicial powers, to an irresponsible body which is described
*361
as a ‘public body corporate and politic . . .’ ” The power given the Parking Authority of eminent domain, the power to make contracts and leases, to make regulations to carry into effect the purposes of the parking laws and all the other powers provided by those laws, are similar to and no more arbitrary than those granted Housing Authorities by the housing laws above mentioned and which were held to be constitutional in
Housing Authority
v.
Dochweiler, supra,
Many of the criticisms of the laws by plaintiff are captious, such as “The very name ‘authority’ is repellant to the fundamental concept of constitutional liberty, and to the theory of separation of powers and of government of checks and balances.” What of the Toll Bridge Authorities, Port Authorities, and the many other public authorities, throughout the United States, having similar powers to those being considered here, the laws creating which have been uniformly upheld?
Applicable here is the following from
Gaylord
v.
City of Pasadena,
We find nothing in the laws which gives the authority arbitrary powers. Actually the powers given are logical, natural and necessary to the accomplishment of the purposes of the act—to provide publicly controlled off-street parking for the public—a purpose which modern developments and practices make most necessary to the well being of the citizens of a city.
Also applicable is the following from
Holloway
v.
Purcell,
There is no division of authority in California on the right of a city to condemn property for off-street parking. Plaintiff cites
City of Whittier
v.
Dixon,
2. The Agreement.
The agreement, boiled down, provides that the city will provide the real property, the corporation will erect or cause to be erected thereon “a public off-street parking facility” in conformance to the city’s requirements, the cost to be repaid the corporation by sums to be paid by the lessee; to insure performance of the agreement and to enable the corporation to borrow the costs of construction the corporate stock will be vested in a certain bank in trust for the city. When the facility is completed the facility shall be leased for operation to the highest bidder under the form of lease attached to the agreement; the parking rates shall at all times be fixed by the authority; when the facility is paid for from the receipts under the lease, the lease may terminate.
The arrangement to finance the construction of the facility *364 is pursuant to the authority of section 32809, Streets and Highways Code: ‘ ‘ The authority may borrow money or accept financial or other assistance from the city, the State, the Federal Government, or any other source for or in aid of any parking facility within its area of operation, and to such ends may comply with any conditions attached thereto.” (Emphasis added.) The effect of the arrangement is that the city, acting through its board of supervisors, and the corporation, have entered into an agreement which provides principally for two things: (l)-the construction of the facility by the corporation and the payment out of gross revenues from the operation of the moneys borrowed to pay the cost of construction; (2) the right of the city as soon as the cost is repaid to terminate the lease and to take over the operation of the facility thereafter.
Plaintiff contends that because the corporation may bid, the provision providing for competitive bids is a “mere simulation of compliance with the law” and that only the corporation “has the slightest chance of obtaining the lease.” The agreement provides, paragraph 5, page 8: “. . . City, pursuant to the provisions of Chapter 4 of the Parking Law of 1949, shall call for bids, and subject to the provisions of this paragraph, make an award of an operating lease of said facility.” The particular provision of the parking law applicable is section 32952 of the Streets and Highways Code. In part, it provides: “The authority may lease any project acquired by it pursuant to this part to the highest responsible bidder after the publication of a notice inviting bids . . (Emphasis added.) We find nothing in the agreement or the terms of the lease which would eliminate the probability of obtaining bidders other than the corporation. For the above mentioned reasons we find nothing in the agreement or the provision which violates charter provisions which require competitive bidding.
Paragraph 5 of the agreement provides that the successful bidder for the lease must execute a deed of trust of his interest in the lease to secure the payment of the corporation finance notes evidencing the loan for the construction of the facility. The escrow instructions under which this deed of trust is deposited with the title company are subject to the approval of the city and the corporation. As the corporation is liable for the payment of these notes we can see no legal objection to its being permitted to approve the instructions by which *365 the deed of trust is deposited with the title company awaiting the execution of the lease and the completion of the documents necessary to be executed by the corporation in obtaining the loan.' Nor can we see any legal objection to the fact that the bidder is required to be “reasonably satisfactory” to the beneficiary of the deed of trust. Such beneficiary will be the lender of the money to the corporation for the construction of the facility. Any objection of the beneficiary to a bidder would have to be based upon bona fide reasons. This clause in no way takes away from the city its real control of the awarding of the lease. Contrary to plaintiff’s assertion, there is no provision requiring the corporation’s approval of the bidder to whom the contract is to be awarded. There is a provision that the city may not consent to any change in or assignment of the lease after execution by the successful bidder without the consent of said beneficiary and the corporation. In view of the large financial interests the beneficiary and corporation will then have in the facility such provision in nowise affects the legality of either the agreement or the lease. Again here any refusal to consent would have to be based upon sufficient reasons. The city would still be in control of the situation.
Plaintiff contends the agreement is invalid because in the form of lease, the percentage of the net profits which the lessee shall pay the city is left blank. This is the biddable portion of the lease and must necessarily be left blank in the form of lease, to be filled in by the percentage bid by the highest responsible bidder. Nor may the corporation bid “as low as it desires.” In the agreement, it agrees to bid a sum equal to 100 per cent of the gross receipts less amounts disbursed for the purposes set forth in the agreement.
There is nothing invalid in the provision in the lease concerning the covenant against assignment without the written consent of the city, “which consent shall not be unreasonably withheld by the city.” This is a phrase commonly used in leases and is not so indefinite as to be likely to cause future litigation as is contended by plaintiff.
Again, criticism is made of the fact that the lessee may sell merchandise such as cigarettes, coca cola and candy. The lease, in effect, limits these matters to commercial activities customarily found in parking facilities. They are expected by the public and are so small both in the area to be used and as to income therefrom as to be merely incidental to the parking activity.
*366 3. City Charter.
Section 32502, Streets and Highways Code (Parking Law of 1949) provides that the procedure under said law is an “alternative method” and does not abridge, modify or otherwise affect the right of any city to exercise any power given it by the Constitution. The powers sought to be exercised by the city could be exercised either under the provisions of the Parking Law of 1949 which expressly confers upon the city in its capacity as a parking authority the powers it proposes to exercise or by the general powers conferred upon the city as a home rule chartered city without the aid of state legislation. The city charter “
'. . .
operates not as a grant of power, but as an instrument of limitation and restriction on the exercise of power over all municipal affairs. ... A construction in favor of the exercise of the power and against the existence of any limitation or restriction thereon ... is clearly indicated. So guided, reason dictates that the full exercise of the power is permitted except as
clearly and explicitly
curtailed. . . .’ ”
(Acton
v.
Henderson,
Here, of course, the city acted under the said parking law, the aforesaid alternative method. Plaintiff contends that the procedure here violated several provisions of the city charter, citing a provision in the Parking District Law of 1951 (Sts. & Hy. Code, § 35703) to the effect that in a parking district formed under the latter act, if any powers or duties prescribed by the act conflict with such powers or duties prescribed by the charter, the latter powers or duties shall apply. However, here the Parking District Law of 1951 was not used and hence cannot apply. Moreover, as hereafter pointed out, the procedure followed here under the 1949 act in nowise violates any provision of the charter.
Off-street parking facilities are purely a municipal affair.
(Mallon
v.
City of Long Beach,
4. Facility Not a Public Utility.
Section 123 deals with leases by the board of supervisors of public utilities. The proposed facility is not a public utility within the meaning of that section. Neither the charter, any legislative act nor the Constitution, has defined off-street parking as a public utility. In the operation of public utilities owned and operated by a city the latter acts in a
proprietary
capacity. (See
Logan
v.
City of Glendale,
In
Glass
v.
City of Fresno, 17
Cal.App.2d 555 [
Section 82 of the charter requires payment to the city treasurer of all funds collected by any employee of the city or in connection with its business. Section 64 relates to the keeping of accounts showing all financial transactions of all departments and offices of the city. Section 72 deals with the city’s annual budget. Plaintiff contends that the agreement, lease and trust fund created violate these provisions of the charter. The trial court found that under the terms of the agreement and lease no money is to be received or come into the hands of any officer or employee of the city. This, of course, does not apply to the city’s percentage of the income of the operation of the facility. That will come into the city treasury. It refers to the moneys received and disbursed in the operation of the facility including the payment of the costs of construction and all other charges. They, of course, will not be received by anyone connected with the city. This operation is properly in the hands of the lessee and the bank handling the trust funds. The lessee is required to deposit all receipts with the bank until the debt incurred for the construction of the facility is paid. If the city then takes over the facility there will be public funds or moneys which must be deposited with the city treasurer. Thus there is no attempt to circumvent the provisions of the charter relating to the custody of public funds.
5. Findings.
The first finding attacked is to the effect that the selection of the site as a necessary and convenient one for the location of a public off-street parking facility was upon the basis of competent and economic engineering advice and of constant and comprehensive traffic engineering studies. The record so amply supports this finding that we deem it unnecessary to discuss the voluminous studies and reports in evidence. Plaintiff’s criticism of these reports is mainly that some of them were made by persons other than officers and employees of the city, the authority for obtaining which and the source of the money for paying those who were employed, plaintiff questions. We see no necessity for going into that question. The reports were considered and there being sub *369 stantial evidence to support the trial court’s conclusions we are without power to overrule those conclusions. Whether as contended the city “squandered the public money on so-called experts from other sections of the country to conduct surveys” we are not required to determine.
Paragraph XIII of the complaint alleged that the public off-street parking project was not for the best interests of the city but for the benefit only of a few merchants having places of business in the immediate vicinity, and for the benefit of private persons owning private vehicles who serve no public purpose, and that the project constitutes an attempt to enrich a private corporation at public expense. The court found “That the allegations in paragraph XIII of plaintiff’s complaint are not true.” Plaintiff contends that such a finding is no finding at all, citing several cases upholding the well known rule that the court must find on all material issues. Plaintiff cites no ease holding that the type of finding above set forth is not sufficient.
Kennedy & Shaw Lbr. Co.
v.
S. S. Const. Co.,
Plaintiff produced testimony of a number of witnesses to the effect that privately owned garages in the general neighborhood of 'the proposed facility do and would amply take care of all parking requirements. This merely created a conflict with respondents’ evidence. We adopt the language of
Barnes
v.
City of New Haven
(1953),
“Just as public streets can be used for the parking of motor vehicles, property can be acquired for the same use. Moreover, public parking places relieve congestion and reduce traffic hazards and therefore serve a public purpose. They may be compared to municipal airports, which have been recognized as public improvements.”
(City of Whittier
v.
Dixon, supra,
Undoubtedly, the stores in the neighborhood of the facility, such as the Emporium, Hale’s and Penney’s, referred to by plaintiff, will obtain benefit from operation of the facility. That fact is not sufficient to take away from the enterprise the characteristics of a public purpose. See
Housing Authority
v.
Dockweiler, supra,
The judgment is affirmed.
Peters, P. J., and Wood (Fred B.), J., concurred.
Appellant’s petition for a hearing by the Supreme Court was denied September 4, 1957.
Notes
Pursuant to the authority of Parking Law of 1949 (Sts. & Hy. Code, §§ 32500-34859).
Health & Saf. Code, §§ 34200-34368, Stats. Ex. Sess. 1938, p. 9, Deering’s Gen. Laws, 1939 Supp., Act 3484; Stats. Ex. Sess. 1938, p. 1, Deering’s Gen. Laws, 1939 Supp., Act 3485.
“The supplying o£ additional parking facilities and the performance of all undertakings incidental or advantageous thereto are public uses and purposes for which public money may be spent and private property acquired, and are governmental functions.” (Sts. & Hy. Code, § 32501.)
In our ease they are provided. Ordinance 9072 is expressly incorporated in paragraph 27 of the lease. That ordinance deals with leases by the city of off-street parking areas and contains many controls and regulations.
See
Parr
v.
Ladd,
