City of Gary v. Indiana Bell Telephone Co.

711 N.E.2d 79, 1999 Ind. App. LEXIS 961, 1999 WL 415417
CourtIndiana Court of Appeals
DecidedJune 23, 1999
DocketNo. 45A03-9808-CV-333
StatusPublished
Cited by3 cases

This text of 711 N.E.2d 79 (City of Gary v. Indiana Bell Telephone Co.) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Gary v. Indiana Bell Telephone Co., 711 N.E.2d 79, 1999 Ind. App. LEXIS 961, 1999 WL 415417 (Ind. Ct. App. 1999).

Opinion

OPINION

STATON, Judge

The City of Gary (“the City”) appeals the trial court’s grant of summary judgment in favor of Indiana Bell Telephone Company, Inc. d/b/a Ameritech Indiana (“Ameritech Indiana”) and the denial of its cross-motion for summary judgment. The City raises one issue on appeal, which we restate as: whether the trial court erred in granting summary judgment for Ameritech Indiana and denying summary judgment in favor of the City.

We affirm in part and reverse in part.

The facts most favorable to the City reveal that the City enacted Ordinance Numbers 6970 and 6971 in January, 1998. Ordinance No. 6970 establishes the Gary Access, Information, and Telecommunications Trust (“GAITT”). Ordinance No. 6970 also adopts a telecommunications policy for the City, which has as one of its goals the development of “a revenue generating concept and model” (§ 3.9) that will aid “the economic revitalization of the City by bringing its residents into the information age through extension of Internet access and other computer based services to all economic strata in the community.” City’s Brief at 5-6. The GAITT is charged with several responsibilities under Ordinance No. 6970, including the development, implementation, and collection of fees designed to obtain fair and reasonable compensation for the commercial use of public rights-of-way.

Ordinance No. 6971 is a companion ordinance that provides funding for the initiatives set forth in Ordinance No. 6970 by imposing a “requirements-based fee” on all telecommunications providers using the City’s rights-of-way. This fee is described as compensation to the City for access to the market for telecommunications within the City and for use of public rights-of-way. The total “requirements-based fee” for 1998 is twenty million dollars. In future years, the total “requirements-based fee” will be calculated in one of three ways: (1) based upon an assessment of the City’s “requirements,” (2) based upon a percentage not to exceed 15% of the providers’ gross revenues, or (3) based upon a “growth factor” calculated from the providers’ telecommunications revenues multiplied by the previous year’s “requirements-based fee.”

Each year, the total “requirements-based fee” is allocated among the various telecommunications providers based upon the kind of carrier and the kinds of services that the carrier has the technical capability to provide. The ordinance contemplates that some or all of the various providers’ portions of the “requirements-based fee” may be discharged by providers furnishing in-kind telecommunications services. For 1998, Ameritech Indiana’s share of the $20 million “requirements-based fee” was $3.2 million.

Ameritech Indiana filed a declaratory judgment action, asking that the ordinances be declared void as exceeding the scope of the City’s municipal powers. After hearing-oral argument on cross-motions for summary judgment, the trial court granted summary [82]*82judgment in favor of Ameritech Indiana. The City appeals.

Summary judgment is appropriate only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Ind. Trial Rule 56(C). The burden is on the moving party to prove there are no genuine issues of material fact and he is entitled to judgment as a matter of law. Once the movant has sustained this burden, the opponent must respond by setting forth specific facts showing a genuine issue for trial; he may not simply rest on the allegations of his pleadings. Stephenson v. Ledbetter, 596 N.E.2d 1369, 1371 (Ind.1992). At the time of filing the motion or response, a party shall designate to the court all parts of pleadings, depositions, answers to interrogatories, admissions, matters of judicial notice, and any other matters on which it relies for purposes of the motion. T.R. 56(C).

In this case, the trial court entered specific findings of fact and conclusions of law. Specific findings and conclusions are neither required nor prohibited in the summary judgment context. Althaus v. Evansville Courier Co., 615 N.E.2d 441, 444 (Ind.Ct.App.1993), reh. denied. Although specific findings aid appellate review, they are not binding on this court. Id. Instead, when reviewing an entry of summary judgment, we stand in the shoes of the trial court. We do not weigh evidence, but will consider facts in the light most favorable to the nonmoving party. Reed. v. Luzny, 627 N.E.2d 1362, 1363 (Ind.Ct.App.1994), reh. denied, trans. denied. We may sustain a summary judgment upon any theory supported by the designated materials. T.R. 56(C).

The trial court granted summary judgment for Ameritech Indiana because it found that the “requirements-based fee” imposed under Ordinance No. 6971 was void under Ind.Code § 36-l-3-8(a)(4) (1993) as a tax, which the City does not have the power to impose.1 The trial court also found that several sections of the ordinances were void as violative of IC 36—1—3—8(a)(7), because they attempted to regulate conduct that is regulated by the Indiana Utility Regulatory Commission (“IURC”).2 Finally, the trial court struck down the remainder of the ordinances because they were not distinctly separable from the voided sections.

The City argues that its “requirements-based fee” is not a tax, as determined by the trial court, but merely a demand for rent from the providers for use of the City’s rights-of—way.3 We agree with the trial court. A careful reading of the City’s ordinances reveals that the “requirements-based fee” cannot be characterized as rent. Section 2.5 of Ordinance No. 6971 defines its fee as “charges assessed to all telecommunications providers for access to the market or use of the public right-of-way.” Record, 18. Blaok’s Law DICTIONARY (6th Ed.1991) defines “rent” as “Consideration paid for use or occupation of property.” By the terms of its own ordinance, the City’s fee is not limited to the provider’s use of property, but also includes charges assessed for “access, to the market.” Further, the “requirements-based fee” is not related to any measure of usage or occupation of the City’s rights-of-way. Rather, the total fee is calculated based on [83]*83the City’s requirements or on the providers’ revenues. The total fee is then apportioned between the various telecommunications providers based on the kinds of services each provides, without regard to how much of the public right-of-way each provider occupies. In fact, the fee is assessed against telecommunications providers, such as cellular telephone providers, that may not use the public rights-of-way at all.

The City relies on City of St. Louis v. Western Union Tel. Co., 148 U.S. 92, 97, 13 S.Ct. 485, 37 L.Ed. 380 (1893), reh. denied., for its argument that the “requirements-based fee” is a rental charge rather than an impermissible tax. In City of St. Louis, the U.S. Supreme Court found that a charge imposed on telecommunications providers by St. Louis was a rental charge, rather than a tax. However, the charge at issue in City of St. Louis

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Related

City of Gary v. Indiana Bell Telephone Co.
732 N.E.2d 149 (Indiana Supreme Court, 2000)

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Bluebook (online)
711 N.E.2d 79, 1999 Ind. App. LEXIS 961, 1999 WL 415417, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-gary-v-indiana-bell-telephone-co-indctapp-1999.