From the September 2000 Idaho Observer:

LOCAL AND SPECIAL LAWS PROHIBITED.

The legislature shall not pass local or special laws in any of the following enumerated cases, that is to say [among 31other things]: For the collection of taxes. ~Article III, Section 19, Idaho State Constitution

Judge's resort tax ruling changes legislative intent

Reed files motion compelling Hosack to reconsider ruling

COEUR D'ALENE -- District Judge Charles Hosack ruled August 21 that the part of the Resort County Sales Tax which specified population qualifications was unconstitutional but allowed Kootenai commissioners to prevail over Concerned Taxpayers of Kootenai County (CTKC) in a civil court challenge to the method of taxation with which the county plans to finance a controversial county jail expansion project. CTKC attorney Scott Reed responded by filing a Motion for Reconsideration September 6 for several reasons, among them, judges do not have the authority to make or change law.

“It is not the duty of the courts to question the wisdom of the legislature nor to correct mistakes other than simple clerical or typographical errors,” wrote Reed in his recently filed motion.

Judge Hosack's ruling came 11 days after the August 10 hearing in which both sides presented their cases at the Kootenai County Courthouse.

After repeatedly rolling his eyes over arguments Kootenai County Civil Attorney Dennis Molenaar presented on behalf of the county in answer to CTKC claims that the Resort County Local Option Sales Tax is unconstitutional, District Judge Charles Hosack said he would take the matter under advisement and “think about it for a week or two.”

Judge Hosack was unclear at the time as to whether he would render a written opinion or bring counsel back to court on short notice to give an oral decision.

The Resort County Local Option Sales Tax, which was sold to the voters as a property tax relief bill that would also fund the Kootenai County Board of Commissioners' controversial jail expansion project, was signed into law June 13 after being narrowly approved by voters last May 23.

The Kootenai County Board of Commissioners announced August 11 that they would raise property taxes 6.5 percent regardless of Hosack's decision regarding the sales tax.

This lawsuit “is not an effort to stop construction of the jail (though many people would like to see that happen), it is not meant to challenge the integrity of the commissioners or the outcome of the election,” Reed explained August 10.

The hearing was convened to argue motions for summary judgment submitted by both the county and CTKC, the plaintiffs in this civil action.

Reed went on to explain that the purpose of the lawsuit was to challenge the constitutionality of the resort county tax which he sees as a “delegation of taxing authority without adequate standards.”

Reed also argued that the tax is a local and special law that is prohibited under Article III, Section 19 of the Idaho State Constitution (see above). Passed by the legislature after a successful lobbying effort by Hagadone Hospitality and Post Falls attorney Chuck Lempesis in 1995, Reed and the eight complainants whom he represents believe that “even if 95 percent of the people approve of something that is illegal, it is still illegal.”

Molenaar's arguments in support of the county's Motion for Summary Judgement were that the complainants had no standing and that the law was upheld by a similar case heard in Sun Valley.

“I'm not terribly impressed with the standing argument,” Judge Hosack stated after Molenaar cited a supreme court decision which ruled that for victims to have standing in a case such as this they must be able to prove “separate and distinct harm.”

Molenaar argued that complainant Sims, for example, has no standing because she has an auto dealership that is exempted from the tax -- an apparent admission that the sales tax is a local and special law prohibited by the Constitution.

The county's other argument with regard to the legislative intent of the law also challenged Judge Hosack's patience. “I am having a real hard time..following your tagging along on the Sun Valley case and 80,000 population,” he said.

Molenaar was hard to follow as he attempted to justify the levying of the resort county tax, supported by the Sun Valley city case, as not being a local and special law. Judge Hosack observed that Kootenai county is the only county that qualifies due to the requirement that the county boast a population in excess of 79,999 to qualify for the local and special sales tax.

“The rationale of Sun Valley does not work for Kootenai county and the county is basing its claims on Sun Valley,” Judge Hosack told Molenaar and the nearly 40 people in the courtroom.

Molenaar cautioned the judge that he should not “question the wisdom of the legislature.”

Judge Hosack clearly took exception to both of the county's arguments in support of summary judgment. Though Molenaar argued the county into what would appear to be a legally indefensible position, Judge Hosack was clearly torn as to how he should rule -- in favor of the Idaho State Constitution and the people of Kootenai county, or in favor of an obviously unconstitutional law and the county government which intends to enforce it.

“The Court was entirely correct in concluding 'that there is no rational basis for the classification set forth in the Resort County Tax Act limiting the class of resort counties to only counties with a population of 80,000 or more.' Memorandum Decision, p. 8. should stop there and declare the Resort County Tax Act unconstitutional,” wrote Reed.