Esling v. Krambeck

2003 SD 59, 663 N.W.2d 671, 2003 S.D. LEXIS 83

Opinions

KONENKAMP, Justice.

[¶ 1.] In this appeal from a denial of a writ of certiorari, we review the circuit court’s ruling that the City of Spearfish lawfully annexed territory under a voluntary petition for annexation. We affirm.

Background

[If 2.] A petition for voluntary annexation under SDCL 9-4-1 was presented to the Spearfish Planning Commission for concurrent annexation and zoning. The property involved is locally known as “Centennial Valley.” It includes the county airport, a few small ranches, the Daryll Propp land (formerly the Frawley Ranch), and the John Esling ranch. The petitioned territory consisted of approximately 2,000 acres and shared a common border with the City of Spearfish. For zoning, the territory was to be designated as an AG Agricultural Conservation District with a Rural Service District tax designation, except the county airport, which was to be zoned for its use.

[¶ 3.] In September 2001, the Lawrence County Commission authorized its chairperson to sign the voluntary annexation petition to include the county owned airport. At the same time, under SDCL 9-4-5, the Lawrence County Commission passed a motion approving the city’s annexation of unplatted lands described in the petition. A week later, the Spearfish Planning Commission scheduled a hearing on the voluntary annexation petition, and published a notice of public hearing on the matter. Approximately one month later, the Spearfish Planning Commission held its public hearing. Despite objections to the annexation by the applicants here, the Commission unanimously recommended that the City Council approve the annexation petition. After published notices, the City Council held three public hearings on the voluntary annexation. The following actions were adopted unanimously: Resolution 2001-33 for annexation, Ordinance 904 for zoning, and Ordinance 905 for the rural service district.

[¶ 4.] The City Council found that the total value of the territory subject to voluntary annexation was $1,913,730 and that the owners of $1,435,298 in value signed the annexation petition (89.94%)

Footnotes

•

1 In cal culating the total value of the territory, the City of Spearfish included the insured value of the Lawrence County Airport public hanger and the value of the privately owned airport hangers on ground leases.²

[¶ 5.] To overturn the annexation, the applicants filed for a writ of certiorari. In its decision, the circuit court subtracted the value of the privately owned airport hangers from the total value, finding that the private owners did not constitute “owners of ... the ... territory sought to be annexed.”³ Nevertheless, the court held that the insured value of the public hanger was properly included in the total value of the annexed territory and that the owners of more than three-fourths of the total value had signed the petition. The applicants appeal, asserting the following errors: (1) “The city and county exceeded their authority in accepting the values used in the voluntary annexation petition.” (2) “The city exceeded its authority since the annexed area is not contiguous.” (3) “The change of zoning in the annexed area is contrary to the initiated ordinance.”

Standard of Review

[¶ 6.] Our review of certiorari proceedings is limited to whether the challenged court, officer, board, or tribunal had jurisdiction and whether it regularly pursued its authority. Peters v. Spearfish ETJ Planning Comm’n, 1997 SD 105, ¶ 6, 567 N.W.2d 880, 883. Certiorari proceedings “cannot be used to examine evidence for the purpose of determining the correctness of a finding....” Willard v. Civil Service Bd. of Sioux Falls, 75 S.D. 297, 298, 63 N.W.2d 801, 801 (1954). Construing a statute entails answering a question of law; thus, we review the circuit court’s statutory interpretation de novo. Ridley v. Laurrence County Comm’n, 2000 SD 143, ¶ 5, 619 N.W.2d 254, 257 (citations omitted): The purpose of statutory construction is to discover the true intention of the law which is to be ascertained primarily from the language expressed in the statute. City of Rapid City v. Anderson, 2000 SD 77, ¶ 7, 612 N.W.2d 289, 291-92 (citations omitted). The intent of a statute is determined from what the Legislature said, rather than what we think it should have said. Id. Words and phrases in a statute must be given their plain meaning and effect. Moss v. Guttormson, 1996 SD 76, ¶ 10, 551 N.W.2d 14, 17 (citations omitted). In interpreting statutes, we presume that the Legislature did not intend an absurd result. Id. We review a trial court’s findings of fact under the clearly erroneous standard and its conclusions of law under the de novo standard. City of Marion v. Rapp, 2002 SD 146, ¶ 5, 655 N.W.2d 88, 90.

Analysis and Decision

1. Value of the Territory

[¶ 7.] The applicants first contend that the circuit court erred in declaring it proper for the city to use the insured value of the public hanger. To address this argument, we review the language of SDCL 9-4-1. Voluntary annexation under that statute requires that the petition must be signed: (1) by not less than three-fourths of the registered voters, and (2) by the owners of not less than three-fourths of the value of the territory sought to be annexed.⁴ SDCL 9-4-1. The applicants do not challenge the first element.⁵ Rather, they dispute whether the second requirement was met, regarding the “value of the territory.” They insist that the term “value” in SDCL 9-4-1 means only the “assessed value” of real property subject to voluntary annexation, and therefore, the circuit court erred when it upheld the city’s decision to include the insured value of the public airport hanger in the total value of the annexed territory. On this precise point, the statute is silent.

[¶ 8.] Accordingly, we must ascertain the meaning of the term “value” as used in SDCL 9-4-1. Statutory wording is given its ordinary meaning, unless it appears from the context that another meaning is intended. Douville v. Christensen, 2002 SD 33, ¶ 11, 641 N.W.2d 651, 654. When a statutory term is not defined, we construe it according to its accepted usage. Spearfish ETJ Planning Comm’n, 1997 SD 105 at ¶ 13, 567 N.W.2d at 885. The ordinary meaning of the term “value” is “the monetary worth or price of something; the amount of goods, services, or money that something will command in an exchange.” Black’s Law Dictionary 1549 (7th ed.1999).

[¶ 9.] Several courts have declared that in voluntary annexations the “assessed value” of the property must be used. But those cases all dealt with statutes that included the word “assessed” or some variation of it. City of Phoenix v. State, 58 Ariz. 8, 117 P.2d 87 (1941); Thain v. City of Palo Alto, 273 Cal.App.2d 400, 78 Cal. Rptr. 240 (1969); Johnson v. City of Spokane, 19 Wash.App. 722, 577 P.2d 164 (1978). In contrast, SDCL 9-4-1 does not expressly state that the “value of the territory” must be the assessed value. If the Legislature had intended to limit “value” to “assessed value,” it certainly could have done so. Without specific statutory direction, therefore, we think the question comes down to a matter of reasonableness.

[¶ 10.] With certiorari review limited to the question whether the city had jurisdiction and whether it regularly pursued its authority, we ask, did the city act in excess of its- jurisdiction or in an irregular pursuit of its authority? Given the broad scope of the word “value” in SDCL 9-4-1, only an unreasonable application of the statute would constitute an act in excess of jurisdiction. Thus, the city’s “action will be sustained unless in [its] proceedings [it] did some act forbidden by law or neglected to do some act required by law.” Save Centennial Valley Ass’n, Inc. v. Schultz, 284 N.W.2d 452, 454 (S.D.1979) (citing State v. State Bd. of Assessment and Equalization, 3 S.D. 338, 53 N.W. 192 (1892)).

[¶ 11.] First, was it reasonable to include the value of the county owned hanger for purposes of SDCL 9-4-1? We conclude that it was. Lawrence County, as a body politic, has the right to petition the City of Spearfish to include its property within the city limits. After it is determined that the owner of the property in question may properly petition for voluntary annexation, SDCL 9-4-1 directs the city to consider the value of Lawrence County’s territory (the airport) seeking annexation.⁶ The term “territory,” as used in SDCL 9-4-1, is synonymous with the term “area” and the real property within that area. Real property consists of “land; that which is affixed to the land; that which is incidental or appurtenant to land; and that which is immovable by law.” SDCL 43-1-3. Accordingly, it was proper for the city to consider the value of the airport land and the value of the airport hanger affixed to the land. See Johnson, 19 Wash.App. 722, 577 P.2d 164 (city owned property was included in the valuation for property seeking annexation); Thain, 273 Cal.App.2d 400, 401, 78 Cal. Rptr. 240 (“ ‘value of the territory’ means the value of land and improvements thereon”).

[¶ 12.] Second, was it reasonable to use the insured value of the county owned hanger? Or, put another way, how should the property value of the Lawrence County Airport be reasonably determined? Again, the statute is silent on how the property should be valued. Given this, any reasonable method of valuation would seem appropriate. Of course, the city could have had the hanger appraised by the county assessor. See Johnson, 19 Wash.App. 722, 577 P.2d 164 (even though city’s property was exempt from tax, the county assessor could assess the property for valuation purposes). Or it could have had a private appraisal. But nothing in our law mandates a particular type of appraisal in this instance. Absent a showing that the building was underinsured, its insured value reflects the cost of replacement should it be totally destroyed.

[¶ 13.] We conclude that for the purposes of SDCL 9-4-1, the insured value of the hangar was a reasonable valuation. Our scope of review is limited to whether the city had jurisdiction and whether it regularly pursued its authority. Spearfish ETJ Planning Comm’n, 1997 SD 105 at ¶ 6, 567 N.W.2d at 883. In our view, the city acted within its authority.

[¶ 14.] Next, the applicants contend that the city’s use of the insured value of the public airport hanger to determine value for purposes of SDCL 9-4-1 violates their constitutional rights. They believe that the two different valuation methods (i.e. the insured value of the public hanger and the assessed value of the real property for tax purposes) used by the city to determine the value of the annexed territory violates their equal protection and due process rights. The valuation of applicant Esling’s land included the value of both the land and the improvements as calculated by the county assessor for tax purposes. SDCL 10-6-35.

[¶ 15.] Under traditional equal protection analysis, it is clear from the test in City of Aberdeen v. Meidinger, 89 S.D. 412, 415, 233 N.W.2d 331, 333 (1975), that SDCL 9-4-1 does not implicate any legitimacy, gender, suspect classes, or fundamental rights and should be reviewed under the rational basis test. Under the first prong of the Meidinger test, SDCL 9-4-1 applies equally to all people. Lyons v. Lederle Laboratories, A Div. of American Cyanamid Co., 440 N.W.2d 769, 771 (S.D. 1989). The statute is inclusive of all petitioners who are owners of property within the annexed territory and uses a single standard: “value.” No arbitrary classification exists. Likewise, the second prong of the Meidinger test has been met. The method used to ascertain value bears a rational relationship between the classification and some legitimate government interest. The city was presented with a voluntary petition to annex territory it deemed to be contiguous and within the natural path of community growth. Under SDCL 9-4-1, the city was then required to confirm that the petition met the minimum value and voter requirements. In determining “value,” the city relied on independent evidence of “value” for the territory seeking annexation. Clearly, the city’s actions bore a rational relationship to a legitimate government purpose. We find no violation of equal protection rights.

[¶ 16.] Although the applicants do not specify whether they suffered a denial of procedural or substantive due process rights, we conclude that neither has been violated. Procedural due process protects certain substantial rights, such as life, liberty, and property, that cannot be deprived except in accord with constitutionally adequate procedures. Tri County Landfill Ass’n, Inc. v. Brule County, 2000 SD 148, ¶ 13, 619 N.W.2d 663, 668 (Tri County IT) (citations omitted). Procedural due process “is flexible and requires only such procedural protections as the particular situation demands.” Id. (citations omitted).

[¶ 17.] Applicant Esling received a personal letter containing the annexation petitions and his attorney attended the public hearing before the Planning Commission. Likewise, all notices of hearing were duly published, and notice to the applicants was clear, public, timely, and unequivocal. None of the applicants were deprived of life, liberty, or property. Applicant Esling, for example, continues to own his property, which was formerly zoned agricultural and is currently zoned as an AG Agricultural Conservation District within the City of Spearfish and is under a Rural Service District for property tax purposes.

[¶ 18.] Similarly, no substantive due process violation has been shown. “A violation of substantive due process occurs when ‘certain types of governmental acts [breach] the Due Process Clause regardless of the procedures used to implement them.’ ” Tri County Landfill Ass’n, Inc. v. Brule County, 2002 SD 32, ¶10, 641 N.W.2d 147, 151 (2002) (Tri County III). Substantive due process analysis begins with an examination of the “interest allegedly violated.” Id. at ¶ 13, 641 N.W.2d at 151-52. Under Tri County III, the applicants are unable to show that they have a protected property interest in not being annexed. The applicants cannot validly argue that they have been deprived of county zoning jurisdiction, because they have no protected property interest in a particular zoning law. Furthermore, even if applicant Esling had a protected property interest, he has not demonstrated that the city’s use of assessed value for his property and insured value for the public hanger was “truly irrational.” Id. at ¶ 11, ¶ 20, 641 N.W.2d at 151, 153. To sustain a substantive due process claim founded on a zoning dispute, the applicants must show that the “government’s action was ‘sufficiently outrageous’ or ‘truly irrational.’” Id. at ¶ 11, 641 N.W.2d at 151 (citations omitted). We conclude that Esling and the other applicants were afforded full due process and equal protection under the law.

2. Contiguous Territory

[¶ 19.] The applicants contend that the circuit court erred in finding that the territory annexed was “contiguous.” Voluntary annexation under SDCL 9-4-1 requires that the territory to be annexed must be “contiguous.” The applicants argue that the territory in question is not “contiguous” to the City of Spearfish. This argument fails in both law and fact. To be contiguous, the annexed territory must: (1) be contiguous to the city, (2) encompass a community of interests, and (3) constitute a natural and reasonable inclusion. Anderson, 2000 SD 77 at ¶ 10, 612 N.W.2d at 292; Krebs v. City of Rapid City, 364 N.W.2d 128, 130 (S.D.1985); Big Sioux Township v. Streeter, 272 N.W.2d 924 (S.D.1978).

[¶ 20.] Under the statute, the term “contiguous” includes “territory separated from the municipality by reason of intervening ownership of land used as a golf course or any land owned by the State of South Dakota or any subdivisions thereof.” SDCL 9-4-1. Our review of cases in other jurisdictions reveals that “contiguous” has been interpreted to mean “adjacent,” “adjoining,” or having a “substantial common boundary.” Anderson, 2000 SD 77 at ¶ 12, 612 N.W.2d at 293 (citations omitted).

[¶ 21.] Here, the annexed property physically adjoins the city. The Lawrence County Airport, land owned by a subdivision of the State of South Dakota, shares a common border with the City of Spearfish. SDCL 9-4-1. Further, the total length of the annexed territory from east to west is more than three miles, and the depth of the territory north to south ranges from one-half mile to one and one-half miles. This fact defeats the applicants’ contention that this is the type of annexation commonly referred to as a “corridor,” “strip,” “shoestring,” or a “long lasso,” disallowed by a majority of courts, including this Court. Anderson, 2000 SD 77 at ¶ 13, 612 N.W.2d at 293 (citations omitted). In sum, we conclude that the territory is contiguous to the city, shares a common border of reasonable length and width, lacks any significant physical barriers or irregular shapes, and has no unjustified narrow corridors, enclaves, or islands of unannexed territory.

[¶ 22.] Next, we consider whether the annexation encompasses a community of interests and is natural and reasonable. The city documented in detail its consideration of the voluntary annexation petition and its finding that the annexation encompassed a community of interests. In addition, the petitioners stated that “we share a common bond and community of interest ■with the City of Spearfish and wish to be contributing members of the community.”

[¶ 23.] In Big Sioux Township, 272 N.W.2d at 926, this Court wrote:

[a] natural and reasonable annexation may result from the following justifications: a need resulting from the orderly growth and development of the municipal corporation; an outflow of benefits including services and facilities to the outlying territory without a corresponding inflow of monetary contribution for such benefits resulting in an uncompensated burden to the municipal corporation; or an expressed need that the outlying territory has for services and facilities that the municipal corporation is able and willing to provide.

See also Krebs, 364 N.W.2d at 130-31. Here, the city found that the annexation was natural and reasonable, since it was compatible with Lawrence County’s comprehensive plan. Moreover, the annexed territory is within the boundaries of the Spearfish Fire Department fire protection district, Spearfish School District 40-2, and the retail trade and medical service area of the city. The annexation encompasses a community of interests and is natural and reasonable.

[¶ 24.] The applicants contend that the annexation improperly excluded a long established residential development located adjacent to the airport property. This argument might be compelling if the city initiated the annexation. But this is a voluntary annexation, and the residents of that development did not seek to be annexed. We conclude that the city did not exceed its jurisdiction and authority in approving the annexation petition. The annexed territory is “contiguous,” encompasses a community of interests, and is a natural and reasonable inclusion to the City of Spearfish.

3. Zoning

[¶ 25.] Finally, the applicants contend that the city’s change of designation from A-l Agriculture zoning to an AG Agricultural Conservation District in the annexed area is contrary to the initiated county zoning ordinance. In June 2001, the voters of Lawrence County passed a county zoning ordinance by initiative in response to the proposed Frawley Ranch development. The ordinance recognized that certain portions of the annexed territory have historically been designated as A-l Agriculture by the Lawrence County Comprehensive Plan and Zoning Ordinance. The initiated ordinance provided that no change in zoning of Centennial Valley be approved or allowed for a period of six years.

[¶ 26.] Under SDCL ch 9^4, a city has the authority to annex contiguous territory. Municipal annexation is subject to approval by the county commissioners if the territory is unplatted, as it was in this case. SDCL 9-4-5. The Lawrence County Commissioners had the authority to approve the annexation. Furthermore, the language of the initiated ordinance did not limit the county commissioners’ authority to approve the proposed annexation. A city has comprehensive planning powers within its corporate limits and can also zone all property within three miles of its corporate limits concurrently with the county zoning commission. SDCL ch 11-2 and SDCL ch 11-4; Lincoln County v. Johnson, 257 N.W.2d 453 (S.D.1977).

[¶ 27.] Although this Court has never addressed the issue of whether a city may zone territory upon annexation contrary to a county zoning ordinance, other jurisdictions have. These courts have held that once a city annexes a territory, it has exclusive zoning jurisdiction over that territory. Ben Lomond, Inc. v. City of Idaho Falls, 92 Idaho 595, 448 P.2d 209, 212 (1968) (county zoning ordinances cease to apply to land annexed to city); Taylor v. Bowen, 272 N.C. 726, 158 S.E.2d 837, 839 (N.C.1968) (after annexation county lost jurisdiction to zone); City of South San Francisco v. Berry, 120 Cal.App.2d 252, 254, 260 P.2d 1045, 1046 (1953) (same); Louisville & Jefferson County Planning & Zoning Comm’n v. Fortner, 243 S.W.2d 492, 494 (Ky.App.1951) (same).

[¶ 28.] Here, then, the initiated county zoning ordinance ceased to apply once the territory was removed from the county’s jurisdiction by annexation.⁷ For this reason, it matters not whether the city zoned the land as agricultural or as residential. The city properly exercised its authority. In one respect, we disagree with the circuit court that the zoning issue was premature. We hold, instead, that Spearfísh has exclusive jurisdiction to zone the annexed territory and that the territory is no longer subject to the initiated county zoning ordinance.

[¶ 29.] Affirmed.

[¶ 30.] GILBERTSON, Chief Justice, and ZINTER and MEIERHENRY, Justices, concur. [¶ 31.] SABERS, Justice, dissents.

1

.

Lawrence County Airport 440.00 acres no assessed value

Public hanger structure $ 950,000 (insured value)

Private Airport Lessees

Daniel P. Custis, Jr. $ 23,030

Duane Berke * $ 15,940

Rich Krogstad $ 15,280

Bill Povandra $ 6,190

Ted J. Miller $ 108,280

Star Aviation $ 165,720

Other Real Estate Tracts

Frawley Ranches, Inc. $ 130,530 404.77 acres

William Carlstrom $ 87,830 154.57 acres

Richard Carlstrom Uttke Family Limited Pt. $ 49,220 $ 185,070 280.00 acres

John H. Esling * $ 176,640 797.24 acres

Total $1,913,730

75% of Value $1,435,298

Value of Petitioners $1,721,150

Petitioners Percentage of Value 89.94%

Denotes non-petitioner

2

. The Lawrence County Airport has improvements located within its boundaries, including privately owned hangers on ground leases and the public hanger building. The annexation petition was signed by owners of the private hangers, which were assessed for tax purposes as real property.

3

. We need not review the correctness of the circuit court’s decision to exclude the value of the private hangars on leased ground. The total value of the properly within the territory without the leased property is $1,595,230. Of that amount, the petitioners accounted for $1,402,650 or 87.93 percent of the total value. Thus, the required value was well over the statutory minimum amount of not less than three-fourths of the total value of the territory seeking annexation.

4

. SDCL 9-4-1 provides in part:

The governing body of a municipality, upon receipt of a written petition describing the boundaries of any territory contiguous to that municipality sought to be annexed to that municipality, may by resolution include such territory or any part thereof within such municipality if the petition is signed by not less than three-fourths of the registered voters and by the owners of not less than three-fourths of the value of the

territory sought to be annexed to the municipality.

5

. It appears that there are five registered voters, William and Jane Carlstrom, Richard and Gwen Carlstrom, and Steven Meyer, who reside within the territory seeking annexation. All five signed the voluntary petition for annexation. Therefore, well over three-fourths of the registered voters residing in the area seeking annexation signed the petition as required by SDCL 9-4-1.

6

. There is no explicit pronouncement in the municipal annexation statutes, SDCL Chapter 9-4, that publicly owned property should be excluded nor is there any such implication.

7

. A review of the record reveals that the City of Spearfish immediately zoned the territory upon annexation.