State of Missouri ex inf. Charles J. Dykhouse, Boone County Counselor in his Official Capacity v. City of Columbia, Missouri

509 S.W.3d 140, 2017 Mo. App. LEXIS 30
CourtMissouri Court of Appeals
DecidedJanuary 17, 2017
DocketWD79352
StatusPublished
Cited by3 cases

This text of 509 S.W.3d 140 (State of Missouri ex inf. Charles J. Dykhouse, Boone County Counselor in his Official Capacity v. City of Columbia, Missouri) is published on Counsel Stack Legal Research, covering Missouri Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
State of Missouri ex inf. Charles J. Dykhouse, Boone County Counselor in his Official Capacity v. City of Columbia, Missouri, 509 S.W.3d 140, 2017 Mo. App. LEXIS 30 (Mo. Ct. App. 2017).

Opinion

Karen King Mitchell, Judge

Charles J. Dykhouse filed a petition in quo warranto, purportedly in his capacity as Boone County Counselor, seeking to oust the City of Columbia from engaging in any tax increment financing (TIP) projects for a minimum of five years. Dyk-house' argued that, while engaged in previous TIF projects, City violated the statutory reporting requirements for municipalities engaging in TIFs and, therefore, lost its authority to continue engaging in TIF projects by operation of law. Despite numerous objections, writ petitions, and dispositive motions from City arguing that Dykhouse lacked authority to file a quo warranto action and that the alleged violations did not fall within the purview of quo warranto proceedings, the circuit court nonetheless entered a judgment of ouster, prohibiting City “from implementing any new tax increment finance project ... through December 31, 2019.” Because Dykhouse lacked authority to seek quo warranto and because City’s alleged violation is not the proper subject for a quo warranto proceeding, we reverse the decision of the trial court with instructions to dismiss the petition.

Background

A. The TIF Act, §§ 99.800-99.865 1

“The TIF Act authorizes a city to undertake a redevelopment project under certain conditions laid out in Section 99.810.” State ex rel. City of Desloge v. St. Francois Cty., 245 S.W.3d 855, 858 (Mo. App. E.D. 2007). “Funds for the redevelopment project come essentially from the future increase in the value of the land once the redevelopment project is complete.” Id, “The TIF Act calls for the city implementing the plan to create a TIF Commission to formulate the plan and oversee its implementation.” Id. “The Commission’s actions are subject to the final approval of *143 the governing body of the municipality.” Id. “The Commission’s recommendations go into effect upon the municipality’s adoption of them by ordinance or resolution.” Id. “Once the redevelopment plan is in place, the municipality begins to accumulate funding in a special allocation fund.” Id. “Each year that the post-plan assessed value of the taxable real property within the redevelopment project area exceeds the pre-plan assessed value, property taxes on the increase in value are abated.” Id. “Instead of paying taxes, the landowners make payments in lieu of taxes equal to the amount the taxes would have been after improvements.” Id. “Those payments go into the special allocation fund.” Id.

Under § 99.865, municipalities engaging in TIF projects have certain reporting obligations regarding the status of each redevelopment plan and project. Before 2009, the statute was silent regarding any penalty for noncompliance. But, in 2009, § 99.865.7 was enacted, and it provided: “Any municipality which fails to comply with the reporting requirements provided in this section shall be prohibited from implementing any new tax increment finance project for a period of no less than five years from such municipality’s failure to comply.” 2009 Mo. Laws 379 (HB 191).

B. City’s TIF projects and quo war-ranto proceedings

Beginning in 2009, under the authority of the TIF Act, City engaged in the creation of three separate TIF projects—the 10th and Locust Redevelopment Plan, the Tiger Hotel Redevelopment Plan, and the Regency Hotel Redevelopment Plan. The 10th and Locust Redevelopment Plan was never constructed, but both the Tiger Hotel and the Regency Hotel Redevelopment Plans were substantially complete and in operation by 2014. In December 2013, City began an evaluation to determine whether to establish an additional TIF district in central Columbia, and it performed a cost-benefit analysis to determine feasibility.

On January' 24, 2014, the Boone County Commission (Commission) sent a letter to City via the city council (Council), formally requesting City to abandon any efforts to create a downtown TIF district. The Commission identified various concerns and asked to be included in a discussion of possible alternative solutions. The Commission’s letter closed by expressing a desire “to avoid a needless and costly legal battle regarding Columbia’s ability to implement any new tax increment financing projects due to its failures to provide required, annual reporting on its existing TIF efforts.” The Commission requested that City “terminate the TIF effort currently underway” and confirm its intent to do so no later than January 31,2014.

On February 6, 2014, Dykhouse, purportedly acting ex officio as the Boone County Counselor, filed a petition in quo warranto, naming City as Respondent, seeking a “[j]udgment of [q]uo [wjarranto finding that [City, via the operation of § 99.865.7] lacks the authority it is usurping to itself by attempting to engage in a new TIF projeet[ and] ordering that such lack of authority will persist through at least December 31, 2017.” Dykhouse alleged that his authority to file the petition derived from § 56.640.3.

On Februaiy 17, 2014, City abandoned its effort to create the central Columbia TIF district, and as of April 2014, City was no longer pursuing the formation of any TIF district within its borders.

In response to Dykhouse’s petition, City repeatedly, but unsuccessfully, argued in dispositive motions and writ petitions that Dykhouse, as County Counselor, lacked standing to bring a quo warranto action, that quo warranto did not lie under the facts alleged, and that the issue was not *144 ripe in light of the fact that City had abandoned its only effort to create a new TIF district. The trial court rejected City’s arguments and entered findings of fact and conclusions of law, determining that City had repeatedly violated its reporting obligations under § 99.865 and was, therefore, “prohibited from implementing any new tax increment finance project for a period of no less than five (5) years from the last violation of the reporting requirements of RSMo § 99.865, or through December 31, 2019.” City appeals.

Analysis

City brings nine points on appeal. In its first point, City argues that the trial court erred in finding the matter ripe for review in light of the facts that City had abandoned its only existing effort to create a new TIF district and had no new plans in the works. In its second point, City argues that the trial court erred in finding that quo warranto was the appropriate vehicle for Dykhouse’s challenge, as City had the power to create TIF districts and, therefore, was not a usurper. In its third and fourth points, City argues that Dykhouse, as a County Counselor, either lacked standing to bring a quo warranto action or failed to prove necessary facts to establish standing. In its fifth and sixth points, City challenges the trial court’s determination that City violated its reporting obligations. In its seventh and eighth points, City challenges the admission of certain evidence as beyond the scope of the pleadings. And in its ninth and final point, City argues that the trial court erred in finding that the most recent violation occurred on December 31, 2014.

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Bluebook (online)
509 S.W.3d 140, 2017 Mo. App. LEXIS 30, Counsel Stack Legal Research, https://law.counselstack.com/opinion/state-of-missouri-ex-inf-charles-j-dykhouse-boone-county-counselor-in-moctapp-2017.