September 16, 1997
The Honorable Timothy N. Tallent N.C. House of Representatives Room 1104, Legislative Building Raleigh, NC 27601-1096
RE: Advisory Opinion; Revenue Bills; Constitutional Requirement that Laws Authorizing Counties or Cities to Impose any Tax must comply with the North Carolina Constitution; Article II, Section 23 of the North Carolina Constitution
Dear Representative Tallent:
You ask our opinion whether S.L. 1997-452 (House Bill 786), to the extent it authorizes Cabarrus County or the City of Concord to increase or levy a sales tax or any other tax, is constitutional. For reasons which follow, to the extent House Bill 786 authorizes Cabarrus County or the City of Concord to levy a tax, it is unconstitutional because it was not read on three separate days in each house of the General Assembly, as required by Article II, Section 23 of the North Carolina Constitution.
House Bill 786 authorizes the City of Concord and Cabarrus County to provide for referenda to be held on "any question of public interest" upon petition of 25 percent of the voters or upon resolution of the city or county governing boards. If the voters approve the proposed measure, "then the vote of the people shall be binding" and "the measure shall become effective." This language appears to authorize any measure whatsoever, including the levy of a sales tax or other local tax.
Article II, Section 23 of the North Carolina Constitution provides:
No law shall be enacted to raise money on the credit of the State, or to pledge the faith of the State directly or indirectly for the payment of any debt, or to impose any tax upon the people of the State, or to allow the counties, cities, or towns to do so, unless the bill for the purpose shall have been read three several times in each house of the General Assembly and passed three several readings, which readings shall have been on three different days, and shall have been agreed to by each house respectively, and unless the yeas and nays on the second and third readings of the bill shall have been entered on the journal. (Emphasis supplied.)
The legislative history of House Bill 786 is enclosed. The measures relating to the initiative and referendum for Concord and Cabarrus County were not in House Bill 786 when it passed the House on April 17, 1997. These measures were added in a Senate Committee Substitute, which was adopted on August 4, 1997, but received both its second and third readings on the same day, August 5, 1997. When the bill was returned to the House of Representatives, that body concurred on one day, August 28, 1997, not on three separate days. Therefore, it is clear that the requirements of Article II, Section 23 of the Constitution were not complied with. Our State Supreme Court has stated on numerous occasions that an act of the General Assembly which is not passed with the formalities required by Article II, Section 23 is void. See, Union Bank v. Commissioners of Oxford, 119 N.C. 214 (1896); Commissioners of Stanly County v. Snuggs, 121 N.C. 394 (1897), which are cases decided by the Supreme Court under former Article II, Section 14 of the North Carolina Constitution of 1868, which is substantially the same as Article II, Section 23 of our present Constitution. See, N.C. Eastern Mun. Power Agency v. Wake County, 100 N.C. App. 693 (1990), cert. denied, 329 N.C. 270 (1991).
Andrew A. Vanore, Jr. Chief Deputy Attorney General