Opinion
No. 39866
Decided June 22, 1966.
Taxation — Exemptions — Section 5709.20 et seq., Revised Code — Statutory construction — "Industrial air pollution," construed — Smokestack does not qualify for tax exemption, when.
APPEAL from the Court of Appeals for Stark County.
The appellee's plant at Brilliant, Ohio, commenced operation in 1951 and very shortly thereafter began to receive complaints from residents of the village in which it was located, which complaints concerned the volume of smoke being emitted by the appellee's operations. From the testimony, it is apparent that the smoke was of the approximate volume of 7,000,000 cubic feet per minute and contained volatilized silica, alumina, magnesia, carbon, iron or iron oxides and chrome or chrome oxides. One witness testified that "something like five or six tons" of solid material per 24-hour period were emitted into the atmosphere. Studies were made to discover means of abating the cause of the complaints. Subsequently, it was decided to erect a smokestack at a cost of $236,978.34 for the purpose of removing the smoke from the building at the furnace level and putting it out at the 400-foot level, thus eliminating or at least minimizing the local nuisance so as to abate the complaints.
Sections 5709.20 to 5709.26, Revised Code, were enacted by the General Assembly and became effective in 1963.
Section 5709.25, Revised Code, provides for the tax exemption of property for which a pollution-control certificate has been issued.
Section 5709.20, Revised Code, defines as a "pollution control facility" any property designed, constructed or installed for the primary purpose of eliminating or reducing industrial air pollution which renders such air harmful or inimical to the public health or to property within this state.
Section 5709.21, Revised Code, provides that the application for a pollution-control certificate shall be filed with the Tax Commissioner who shall issue such certificate if he finds that the proposed facility "was designed primarily for the control of pollution of the air as defined in Section 5709.20 of the Revised Code * * *."
The Tax Commissioner failed to so find and refused to issue the requested certificate. On appeal to the Board of Tax Appeals as authorized by Section 5709.24, Revised Code, in the manner and form provided by Section 5717.02, Revised Code, the order was affirmed.
Thereafter, appellee appealed to the Court of Appeals for Stark County which found the facility in question to be an "air pollution control facility" as defined by Section 5709.20, Revised Code, and ordered the issuance of a certificate and the granting of the exemption. ( 3 Ohio App.2d 256.)
The cause is before this court pursuant to the allowance of a motion to certify the record.
Messrs. Day, Ketterer, Raley, Wright Rybolt and Mr. John F. Buchman, for appellee.
Mr. William B. Saxbe, attorney general, and Mr. Edgar L. Lindley, for appellants.
The sole question to be decided is whether the chimney constructed in 1954 for the admitted purpose of diffusing polluted smoke so as to eliminate a local nuisance now qualifies as a "pollution control facility" as defined by Section 5709.20, Revised Code (effective October 14, 1963), requiring the isusance of a certificate permitting tax exemption for such a facility pursuant to Section 5709.25, Revised Code.
Admittedly, the smoke emitted from the appellee's plant contains volatilized silica, alumina, magnesia, carbon, iron or iron oxides and chrome or chrome oxides in quantities approximating five or six tons of solid material per 24-hour period. Admittedly, nothing is removed from this smoke by the facility. Everything that goes in at the bottom of the chimney goes out at the top.
Section 5709.20, Revised Code, requires as a prerequisite of exemption that the facility for which exemption is claimed be "designed, constructed, or installed for the primary purpose of eliminating or reducing air pollution which renders such air harmful or inimical to the public health or to property within this state."
Appellee must admit that the pollution which existed here was "harmful or inimical to the public health or to property," otherwise there is no basis for exemption. Exemption is justified by reducing or eliminating only such pollution as is harmful to health or property within this state.
Although one witness testified that the effect of this facility would be to reduce the concentration of pollutants in the Brilliant area, there is no evidence that diffusion, which was the sole effect of the facility for which exemption is claimed, rendered such smoke less harmful to health or property "within this state." Notwithstanding that any given cubic foot of Ohio air in the Brilliant area contained fewer pollutants as a result of the claimed diffusion, a greater number of cubic feet of air "within this state" contained pollutants. Property near the plant was harmed less and a local nuisance was eliminated but there is no evidence that expelling the pollutants at the 400-foot level reduced or eliminated general air pollution "within this state."
It may be assumed that the General Assembly in enacting this statute intended to encourage company management to make capital investments which would benefit the public generally by reducing or eliminating a contribution to the overall air pollution problem which is now present within this state and which will, in absence of some legislation, become a severe problem in the future. The cumulative effect of many minor contributions to general air pollution will not be lessened if everyone merely builds a smokestack.
We are also of the opinion that the order of the Tax Commissioner denying the certificate is not unreasonable or unlawful in that the evidence would have justified a finding that the facility was as a matter of fact not suitable and reasonably adequate for the purpose of air pollution reduction or limitation even if intended for that purpose. This court has invariably recognized the proposition that tax exemption pro tanto violates the constitutional requirement of tax uniformity as well as the related proposition that statutory language granting tax exemption when construction is required must be construed most strongly against exemption. National Tube Co. v. Glander, Tax Commr., 157 Ohio St. 407.
In view of the foregoing, this court is of the opinion that the Court of Appeals erred in its judgment that the decision of the Board of Tax Appeals affirming the refusal of the Tax Commissioner to issue the certificate of exemption is unlawful and unreasonable.
The judgment of the Court of Appeals is reversed, and the decision of the Board of Tax Appeals affirming the order of the Tax Commissioner denying the certificate of tax exemption is affirmed.
Judgment reversed.
TAFT, C.J., ZIMMERMAN, MATTHIAS, O'NEILL, HERBERT, CRAWFORD and BROWN, JJ., concur.
CRAWFORD, J., of the Second Appellate District, sitting for SCHNEIDER, J.