Alabama Advisory Opinions January 09, 1985: AGO 85-00168 (January 09, 1985)

Advisory Opinion Text

James R. Solomon. Jr. Deputy Attorney General

Walter S. Turner, Chief Assistant Attorney General

H. Ward McMillan. Jr., executive assistant to the attorney general, Janie Nobles Executive Assistant

Honorable Jack Floyd, Attorney

Etowah County Commission

816 Chestnut Street

Gadsden, AL 35999-2701

Ad Valorem Taxes -- Elections

Approval of amendment to Amendment No. 432, as authorized by Act 84-132, satisfies requirement contained in Act 84-132 concerning method of approval of tax levy authorized thereby.

Special 3 mill tax for fire protection levied thereby is subject to homestead exemption according to terms of exemption statute.

Tax money collected on property located in municipal fire district to be disbursed to county general fund.

Dear Mr. Floyd:

In your request for an opinion on behalf of the Etowah County Commission, you state that on April 6, 1984, the Alabama Legislature passed Act No. 84-132, which proposed an amendment to Amendment No. 432, Constitution of Alabama of 1901, relating to fire protection districts in Etowah County. Specifically, the Act provides for the levy and collection of additional property taxes for fire protection in such districts. At the election of September 26, 1984, the amendment to Amendment No. 432 was adopted by the people of the State of Alabama.

Prior to the adoption of the Amendment, the Etowah County Commission had established a fire district composed of all rural Etowah county located outside the corporate limits of municipalities. Incorporated municipalities comprised other municipal fire districts. In the election of September 26, 1984, in each fire district, both rural and municipal, a majority of the qualified electors who voted, voted in favor of the amendment. The Etowah County Commission now proposes to purchase fire equipment based on future revenues generated from the special three-mill fire protection tax levied pursuant to the amendment. You ask five questions:

1. Does the approval of the amendment as expressed by the vote in each fire district in favor of ratification satisfy the requirement of a special election in each fire district on the question of whether said tax should be levied, or must an additional special election be held in each district so as to place the levy in effect on the property in that fire district?

2. May the Etowah County Commission now obligate future revenues from the special three-mill levy to the present purchase of firefighting equipment and vehicles for the various rural fire districts and municipal fire districts who have chosen to become subject to the provisions of the amendment?

3. Is the special three-mill fire protection tax to be levied on homestead property?

4. How must the Etowah County Commission disburse the monies collected from the assessment each year, that is, must the tax collected in each fire district be distributed solely to that fire district, or may the Etowah County Commission determine a different formula for distribution on a county-wide basis?

5. To whom must the money collected in a municipal fire district be paid, and on what basis?

Amendment No. 432, as amended by Act No. 84-132, now provides:

The Etowah County Commission is authorized in its discretion to establish fire districts within the geographical boundaries of Etowah County, said districts to exclude any corporate municipality. Provided, however, any corporate municipality may request through resolution of its governing body to become subject to the provisions of this amendment upon the approval of the additional tax levied herein by a majority of the qualified electors of the corporate municipality.

There is hereby levied, in addition to any taxes now authorized or that may be hereafter authorized by the Constitution and laws of Alabama, a fire protection tax of three mills. The fire protection tax levied herein shall be based upon the value of real and personal property assessed by affected property owners, as shown on the records of the tax assessor of Etowah County, Alabama, and shall be assessed and collected as are all ad valorem taxes in the county. The amount collected each year from assessment of this fire protection tax shall be paid into the county general fund and used in furtherance of fire protection within the affected area. Prior to the levy of the fire protection tax in a fire district, there shall be submitted to the electors of the district, at a special election called for that purpose in the district, the question of whether the said tax shall be levied, and the said tax shall be authorized at such election by a majority of the qualified electors within any particular fire district of the county or corporate municipality therein who vote at such election; provided further, that if a majority of the qualified electors of any of the fire districts participating in the election on the ratification of this amendment shall vote for the ratification of this amendment, then the approval of this amendment as expressed by the vote in said district in favor of this ratification shall, of itself, authorize the levy and collection of the tax for fire protection purposes in that fire district, commencing with the levy for the tax year for which taxes will become due and payable on October 1, 1985.

In answer to Question 1, it appears from the language of the Amendment that the vote of the people in each fire district served the dual purpose of ratifying the amendment and satisfying the requirement of the special election in the rural fire district and in each municipal fire district that, through resolution of its governing body, agreed to become subject to the provisions of the amendment upon the approval of the additional tax levied by a majority of the qualified electors of the municipality. Therefore, no additional special election need be held in each district in order to place the levy in effect on property in that fire district.

Inasmuch as the special three-mill levy is legally in effect, there is no reason why the Etowah County Commission may not obligate future revenues from the tax. Your Question No. 2 is therefore answered in the affirmative. See Quarterly Report of the Attorney General, Vol. 20, p. 85.

The amendment is silent concerning the issue of whether any presently existing exemptions apply to the tax levied thereunder. The general rule is that when the constitution specifically creates exemptions from taxation, there is an implied prohibition against other legislative grants in that connection. This implied prohibition also applies when the taxation requirements of the constitution manifest a purpose to include all those who own property which is made taxable or who are within its provisions. Unless restricted by express or implied constitutional provisions, however, the power to exempt from taxation is as much a legislative prerogative as the power to tax. State v. Alabama Education Foundation , 231 Ala. 11, 163 So. 527. In this regard the Supreme Court has stated that §§211 and 217 of the Constitution of Alabama 1901 do not require that all property be taxed. They do not prohibit exemptions or a reasonable classification. City of Mobile v. Salter , 287 Ala. 660, 255 So.2d 5 (1971). Amendment No. 432 does not appear to manifest any purpose to include all property and to allow no exemptions. Except insofar as constitutionally proscribed, there is no limit to the legislative authority over taxation. Newton v. City of Tuscaloosa , 36 So.2d 487. Therefore, one must look to the terms of the exemption statutes themselves in order to determine whether a particular exemption applies to the tax levied by the amendment. If, under the terms of an exemption statute, the exemption applies to taxes of this nature, then said tax is subject to such exemption. Since the tax is by its terms paid into the county general fund, it must be considered to be a county ad valorem tax subject to the homestead exemption contained in §40-9-19, Code of Alabama 1975 . Your Question No. 3 is therefore answered in the negative.

In answer to your Question No. 4, the amendment states that "The amount collected each year from assessment of this fire protection tax shall be paid into the county general fund and used in furtherance of fire protection within the affected area." The language "used in furtherance of fire protection within the affected area" seems to indicate an intention that the money generated in a particular fire district be expended on fire protection for that particular fire district. This interpretation is further supported by the fact that the electors in each fire district were given the option to approve or reject the tax within their particular fire district. However, nothing contained in the Act prevents the fire districts from agreeing to pool their resources where this would be mutually beneficial, so long as the tax monies are used in furtherance of fire protection in the fire districts.

In answer to your Question No. 5, inasmuch as the amendment specifically states that the amount collected shall be paid into the county general fund, this office must opine that the money collected in a municipal fire district must be paid into the county general fund. As previously stated, however, this money must be expended for fire protection within the municipal fire district from which it was collected.

Sincerely yours,

CHARLES A. GRADDICK, Attorney General.

BYRON BOWDEN, Assistant Counsel.