Opinion
No. 20928
Decided June 20, 1928.
Municipal corporations — Construction of public utilities — Initial and subsequent ordinances subject to referendum — Sections 4, 5 and 8, Article XVIII, Constitution.
Under Sections 4, 5 and 8, Article XVIII, of the Constitution, of the State of Ohio, when a municipality proceeds to construct a public utility, not only the initial ordinance authorizing such construction, but every other ordinance in furtherance of such construction, is subject to referendum under Section 8 of Article XVIII.
IN MANDAMUS.
This is an original action in mandamus filed by the state on relation of a taxpayer of the city of Defiance, Ohio, against the members of the city council of the city of Defiance and Charles M. Eberle, auditor of the city of Defiance. Demurrer was filed to the petition, but leave was granted upon hearing upon the demurrer to file an amended petition. After the amended petition was filed the defendants answered and a reply was filed to the answer. The amended petition in substance avers the following facts:
The council of the city of Defiance first passed Ordinance No. 873, declaring their purpose to construct a municipal electric plant under and pursuant to Sections 4 and 5, Article XVIII, of the Constitution of Ohio, and, to raise money therefor, to issue mortgage bonds in the sum of $405,000, under the provisions of Section 12, Article XVIII, of the Constitution of Ohio.
Two weeks later the council passed Ordinance No. 874, providing for the issuance of mortgage bonds in the amount of $405,000, in accordance with Section 12, Article XVIII, of the Constitution, providing for a franchise and the terms upon which the utility should be operated in case of foreclosure, providing for a 10-year contract for street lighting, and further providing the rates and terms of operation by the city during the lifetime of the bonds.
Ten days after this second ordinance was passed, referendum petitions were filed on the first (or the construction) ordinance, No. 873, and council duly provided for submitting to the electors at the primary election to be held in August, 1927, the question of approval or rejection of such construction ordinance, No. 873.
At this election, Ordinance No. 873 was approved by a vote of 1378 to 1274.
Thereafter, on December 20, 1927, the city council passed Ordinance No. 893, which expressly repealed Ordinance No. 874 (the first bond issue ordinance), and provided for a bond issue, a franchise, a contract for street lighting and rates for operation, substantially different in numerous respects from the provisions of Ordinance No. 874.
On January 17, 1928, petitions were filed with the mayor of the city of Defiance, asking for a referendum on the last bond issue, Ordinance No. 893. The petitions contained the signatures of more than ten per cent. of the electors, and complied with all the requirements and provisions of Section 8, Article XVIII, of the Constitution.
The council of the city of Defiance refused to provide for the submission of Ordinance No. 893 to a referendum, and has not provided for such submission.
On January 18, 1928, the relator, a resident and taxpayer of the city of Defiance, made a written request upon the solicitor of the city of Defiance to institute an application for a writ of mandamus, which the city solicitor refused to do. The relator then filed a petition in mandamus in this court.
The petition, in addition to the above facts, in substance, alleges that at the time of the filing of the referendum petitions upon Ordinance No. 873, and during the campaign upon the referendum election held pursuant to such petitions, the principal basis upon which the approval of Ordinance No. 873 was urged and secured was the content of Ordinance No. 874, and that a large number of the electors of the city of Defiance voted for the approval of Ordinance No. 873 on the basis of the provisions of Ordinance No. 874, as theretofore passed by the council, which provided in detail for the method by which the proposed municipal lighting plant, authorized by Ordinance No. 873, was to be paid for, the terms upon which foreclosure might be had, and the franchise for street lighting.
The petition further alleges that Ordinance No. 893 contains substantial changes in its provisions from the provisions of Ordinance No. 874, providing changes in the date of the maturity of the bonds, changes in the time of the payment of interest, changes in the purpose to which the interest and premium received from the sale of the mortgage bonds may be applied, changes in the rates at which electric energy is to be supplied to the city, by which such rates are materially increased, and changes in the power of the city to sell or lease such municipal electric works when constructed, and other material changes. The prayer of the petition is that a peremptory writ of mandamus issue, compelling the council of the city of Defiance, Defiance county, Ohio, forthwith to provide by ordinance fixing a date for an election for the submission to the electors of the city of Defiance, Defiance county, Ohio, of Ordinance No. 893 for approval or rejection. The answer admitted the formal allegations of the petition, the enactment of the three ordinances in question, the holding of the referendum upon the initial ordinance, and the refusal to provide by ordinance for the submission of Ordinance No. 893 to a refer endum vote. The answer contained a denial of all the averments of the amended petition, except those specifically admitted to be true, and further set up in substance, that the alleged referendum petition praying for a referendum upon Ordinance No. 893 was prepared, circulated and signed pursuant to the provisions of Sections 4227-1 to 4227-3, inclusive of the General Code; that the signers of the said so called referendum petition designated a committee to file such a petition with the city auditor of the city of Defiance; that the petition was filed with the city auditor of the city of Defiance on January 17, 1928; that the city auditor, acting upon the advice of the city solicitor of the city of Defiance, signed a written refusal to certify such petition to the board of deputy state supervisors of elections; and that, immediately after the signing of such written refusal by the city auditor, the petition was taken from the custody of the city auditor and delivered to the mayor of the city. The reply denies all of the allegations of the answer, except such as are admissions of the truth of allegations contained in the amended petition.
Mr. Richard Sutphep and Messrs. Tracy, Chapman Welles, for relator.
Mr. M.A. Goller and Messrs. Knepper Wilcox, for respondents.
The principal question raised by the record involves the problem of the right to referendum upon Ordinance No. 893, the second bond issue ordinance, under Sections 4, 5, 8, and 12, Article XVIII, of the Ohio Constitution. These sections, in their material portions, read as follows:
Section 4: "Any municipality may acquire, construct, own, lease and operate within or without its corporate limits, any public utility the product or service of which is or is to be supplied to the municipality or its inhabitants, and may contract with others for any such product or service. * * *"
Section 5: "Any municipality proceeding to acquire, construct, own, lease or operate a public utility, or to contract with any person or company therefor, shall act by ordinance and no such ordinance shall take effect until after thirty days from its passage. If within said thirty days a petition signed by ten per centum of the electors of the municipality shall be filed with the executive authority thereof demanding a referendum on such ordinance it shall not take effect until submitted to the electors and approved by a majority of those voting thereon. The submission of any such question shall be governed by all the provisions of Section 8 of this Article as to the submission of the question of choosing a charter commission."
Section 8: "The legislative authority of any city or village may by a two-thirds vote of its members, and upon petition of ten per centum of the electors shall forthwith provide by ordinance for the submission to the electors, of the question, 'Shall a commission be chosen to frame a charter.' The ordinance providing for the submission of such question shall require that it be submitted to the electors at the next regular municipal election if one shall occur not less than sixty nor more than one hundred and twenty days after its passage; otherwise it shall provide for the submission of the question at a special election to be called and held within the time aforesaid. The ballot containing such question shall bear no party designation, and provision shall be made thereon for the election from the municipality at large of fifteen electors who shall constitute a commission to frame a charter; provided that a majority of the electors voting on such question shall have voted in the affirmative. Any charter so framed shall be submitted to the electors of the, municipality at an election to be held at a time fixed by the charter commission and within one year from the date of its election, provision for which shall be made by the legislative authority of the municipality in so far as not prescribed by general law. Not less than thirty days prior to such election the clerk of the municipality shall mail a copy of the proposed charter to each elector whose name appears upon the poll or registration books of the last regular or general election held therein. If such proposed charter is approved by a majority of the electors voting thereon, it shall become the charter of such municipality at the time fixed therein."
Section 12: "Any municipality which acquires, constructs or extends any public utility and desires to raise money for such purposes may issue mortgage bonds therefor beyond the general limit of bonded indebtedness prescribed by law; provided that such mortgage bonds issued beyond the general limit of bonded indebtedness prescribed by law shall not impose any liability upon such municipality but shall be secured only upon the property and revenues of such public utility, including a franchise stating the terms upon which, in case of foreclosure, the purchaser may operate the same, which franchise shall in no case extend for a longer period than twenty years from the date of the sale of such utility and franchise on foreclosure."
The contention of the respondents is that under these constitutional sections, no right is given to hold a referendum upon this particular ordinance. It is conceded by the respondents that the general initiative and referendum provision of the Constitution (Section 1-f, Article II), and the statute enacted in pursuance thereof (Sections 4227-1 to 4227-12, General Code), cannot avail here because of the fact that Section 4227-3 expressly provides that there shall be no referendum except upon the initial ordinance. (In this case Ordinance No. 873, the initial ordinance, has already been approved in a referendum.)
As is evident, Sections 4 and 5, Article XVIII, specifically provide for the acquirement, construction, ownership, lease and operation by a municipality of a public utility, and for action upon such question by ordinance, and for referendum upon such ordinance. Ordinance No. 873, passed by the council of the city of Defiance, declared it to be the purpose of the municipality to construct a municipal electric light plant, pursuant to Sections 4 and 5, Article XVIII, and to raise money by the issuance of mortgage bonds. Section 4, Article XVIII, definitely applies to the case of construction of a public utility by a municipality, and hence this constitutional provision directly controls and governs the disposition of the problem presented here. Hence, if this constitutional provision provides for a referendum upon a subsequent ordinance, passed in furtherance of the construction by a municipality of a public utility, as well as upon the initial ordinance, the demurrer upon the ground of the insufficiency of the petition must be overruled.
May a constitutional referendum under Sections 4 and 5, Article XVIII, be had only upon the initial ordinance?
Respondents claim that such a provision must be read into the constitutional measure because of the fact, apparently, that the word "ordinance" is used in the singular. With this contention we do not agree. No decisions exactly in point have been cited upon this proposition. Heffner v. Krinn, 98 Ohio St. 1, 120 N.E. 221, deals with the statutory requirement arising under Section 4227-1, General Code, and has no application here. However, case authority is not necessary. The wording of the Constitution itself compels our conclusion. Section 5, Article XVIII, states that "Any municipality proceeding to acquire, construct * * * a public utility, * * * shall act by ordinance and no such ordinance shall take effect until after thirty days from its passage."
Now the phrase "proceeding to acquire, construct * * * a public utility," is to be interpreted in its ordinary sense. The word "proceed" means to commence and carry on; to conduct; to begin and carry on. 6 Words and Phrases, First Series, 5631. The word "construct" means to build. Obviously a city which is about to build a public utility cannot complete the construction in one step or transaction. There will be a number of separate and distinct transactions before the public utility can be finally constructed. Furthermore, many of these distinct transactions will require distinct and separate ordinances to authorize them. Thus in this instance the council has first enacted an ordinance declaring its purpose to construct a municipal light plant, and to raise the money by the issuance of mortgage bonds. Next the council has enacted an ordinance providing for the issuance of mortgage bonds and for the franchise. Other ordinances will doubtless be enacted dealing with the sale of the bonds and the use of the money so secured in the furtherance of the construction of the plant proposed.
The irresistible conclusion is that, when the Constitution provides that a municipality, proceeding to construct a public utility, shall act by ordinance, it means that each main step essential to the construction must be authorized by ordinance. Then, when the Constitution provides that no such ordinance shall take effect until 30 days after its passage, and provides for a referendum, obviously it intends that any one of the ordinances enacted in furtherance of the construction of the plant may be subjected to a referendum. The second bond issue ordinance, No. 893, providing for the method of financing the construction of the utility, for the franchise and rates of operation, is enacted in furtherance of such construction; hence it is subject to referendum under the Constitution.
We hold, therefore, that the constitutional referendum is available in this action, and is the only method of referendum available.
The only other question raised by the respondents is that the referendum petition was not filed in accordance with the constitutional requirements of Section 5, Article XVIII. They urge that, after the petition had been filed with the city auditor of Defiance, it was placed in the hands of the mayor, who transmitted it to the council with request that the council take action thereon. It is conceded that the petition was signed by 10 per centum of the electors of the municipality, and that it actually came into the hands of the executive authority within 30 days after the passage of the ordinance, as required by Section 5, Article XVIII, of the Constitution, but respondents claim that, inasmuch as the petition was first filed with the city auditor, there was a filing, if any, under the statute (Sections 4227-1 to 42Z7-12, General Code), and not under the Constitution. With this contention we do not agree. A referendum petition was addressed to the mayor and it was actually placed in the custody of the mayor; in other words, it was delivered to the proper officer and received by him to be kept on file. This constitutes a filing. The Constitution does not prescribe any particular method of filing, nor does it require that any particular person shall place the petition in the hands of the executive authority. The filing with the auditor was of no avail, because no referendum could be had upon this particular ordinance under the statute, but it could not destroy the effect of the filing with the mayor, so far as referendum under the Constitution was concerned. Since Section 8, Article XVIII, of the Constitution, provides that the legislative authority of any city or village, "upon petition of ten per centum of the electors shall forthwith, provide by ordinance for the submission to the electors, of the question," the relators have established a clear legal right to the issuance of the writ.
Writ allowed.
MARSHALL, C.J., DAY, KINKADE and ROBINSON, JJ., concur.
JONES and MATTHIAS, JJ., dissent.