LANDS AND BUILDINGS I. IN GENERAL. § 5. Authorization; Funds and Appropriations. § 17. Gifts and Donations. II. PROCUREMENT OF PROPERTY. § 31. Leases and Rentals. III. MAINTENANCE, OPERATION, AND USE OF LANDS AND BUILDINGS. § 35. In General. § 39. Utility Services. IV. SALE, TRANSFER, OR OTHER DISPOSITION; LEASES AND RENTALS. § 51. In General. I. IN GENERAL § 5. Authorization; Funds and Appropriations § 5.1. Generally. Housing under Title VIII of the National Housing Act may legally be certified and constructed for occupancy by personnel attached to those "shore-based fleet air units" which are in fact shore based. However, Title VIII housing should be certified and constructed for personnel attached to shore-based fleet units only to the extent that such personnel are otherwise eligible for housing in accordance with the Navy housing policy. (Citing Section 803 (b) (2) of the National Housing Act, as amended 12 USC 1748B (2); Article 1326, Navy Regulations, 1948; Hearings Before the Committee on Banking and Currency, United States Senate, 81st Congress, 1st Session, on S. 1184, pp 49 and 50.) Op JAGN 1955/272. 11 February 1955. § 15.1. Generally. § 15. Taxes For the purpose of constructing a housing project, land on a military reservation under the exclusive jurisdiction of the United States was leased to two private corporations for a term of seventy-five years. After the project was completed and the apartments were leased to military and civilian personnel designated by the commanding officer of the reservation, two municipalities imposed taxes on the projects. The corporations sought to recover the taxes on the ground that the property was not subject to taxation and that, if the exclusive jurisdiction of the United States was limited to the extent that local taxation was permitted, the taxes had no justification because the municipalities afforded no services as consideration for the taxes imposed. In this connection it was shown that the military authorities supplied water and sewer facilities, garbage and trash collections, fire and police protection, snow and road maintenance, and subsidized the cost of the education of the children in local schools. Electric service was furnished by a private public utility corporation. The authority for the government's contracts with the corporations which built the project was derived from the Military Housing Insurance Act of 8 August 1949, 63 Stat 570, 12 USCA § 1748. The statute made no direct provision for the payment by lessees of local taxes but the financing of the projects involved was done through mortgage insurance by the Commissioner of the Federal Housing Administration and the statute provided in substance that in the event the Commissioner should be required to take over the property, nothing in the statute should be construed to exempt any real property acquired and held by the Commissioner from taxation by any state or political subdivision thereof to the same extent, according to its value, as other real property is taxed. Also, the leases involved provided that the lessee should pay all taxes imposed upon the government or upon the lessee with respect to the leased premises. Held: The property in question constituted private interest in government property susceptible of local taxation. Where lands are within the exclusive jurisdiction of the United States they are immune from taxation by a state and even private property located thereon is not subject to taxation by state. However, under the circumstances herein it appears to have been the intention of the government to relinquish the tax exemption. Furthermore, the fact that many of the services to the project are furnished by the government or by private corporations does not preclude imposition of the taxes since, while it is true that there must be a rendition of service to support a tax, the failure to take advantage of services furnished out of the proceeds of tax funds is no reason for declaring the tax void when the service is available. Taxes otherwise lawful are not invalidated by the fact that the resulting benefits are unequally shared. Nor need the benefits of taxation be direct and tangible. Nor does the fact that the rental charges for the apartments in the project are rigidly controlled by the Commissioner of the Federal Housing Administration preclude imposition of the taxes since it is nothing unusual for owners of properties whose incomes are governmentally controlled to be held liable to state and local taxes. Nor does the fact that the burden of the tax will ultimately fall on government employees invalidate the taxes since there is no reason why a person should enjoy immunity from taxation simply by the circumstance of governmental employment. (Citing Surplus Trading Co. v. Cook, 281 US 647, 74 L ed 1091, 50 S Ct 455; Rainier National Park Co. v. Martin, 18 F Supp 481; Thomas v. Gay, 169 US 264, 42 L ed 740, 18 S Ct 340; Wagoner v. Evans, 170 US 588, 42 L ed 1154, 18 S Ct 730; Morton Salt Co. v. City of South Hutchinson, 159 F2d 897. Cf. Meade Heights, Incorporated v. State Tax Commission, 202 Md 20, 95 A2d 280.) Sheridanville, Inc. v. Borough of Wrightstown (DC, NJ, 1954) 125 F Supp 743. For the purpose of construction and operation of a housing project, a private corporation leased land from the government. The land constituted a part of the United States Marine Corps reservation, Quantico, Virginia, over which the federal government exercises exclusive jurisdiction. The authority for the lease was the Act of 5 August 1947, and amendments thereto (61 Stat 774; 34 USCA 522a-522e). After the housing project had been completed, the corporation was assessed with real estate taxes on the improvements by the county in which the land was located. The statute under which the lease was entered into provided in part that the lessee's interest was to be made subject to state or local taxation and the lease itself provided that the lessee was to pay any taxes imposed upon the property. The lease also provided that upon its expiration all improvements were to remain on the property and become the property of the government without compensation. The Commissioner of Revenue of the county which imposed the taxes testified that in assessing the improvements on the land he placed thereon the same valuation that he would have if the land were owned in fee simple by the corporation. He also testified he made no assessment against the land itself as he did not consider it as being owned by the corporation and that he made no assessment against the corporation with respect to its leasehold interest in the land. Held: The property in question was not subject to local taxation. The land itself was under the exclusive jurisdiction of the United States. Furthermore, by reason of the lease provision that improvements were to remain on the property upon the expiration of the lease, title to the improvements themselves vested in fee simple in the United States subject to the leasehold interest of the corporation. It follows that the land and the improvements thereon were not subject to taxation since they were the property of the federal government. However, the terms of the lease itself and the statute under which it was entered into expressly indicate that the government consented to the taxation of the lessee's interest. However, under applicable Virginia law, the lessee's interest, which is its right to use the land and buildings during the term of the lease, is intangible personal property rather than real property or tangible personal property. As such, it is taxable, if at all, by the state rather than the county. (Citing Fort Leavenworth Railroad Co. v. Lowe, 114 US 525, 29 L ed 264, 5 S Ct 995; U. S. v. Cornell, 2 Mason 60; Commonwealth v. Cleary, 8 Mass 72; 51 Am Jur, pp 88 and 279; 11 Michie's Jurisprudence, pp 635 and 729; Minor on Real Property, vol 1, sec 357; Code of Virginia, Title 58-758, Title 1-13.12, Title 1-13.20 and other cases and authorities. Distinguishing Meade Heights, Incorporated v. State Tax Commission, 95 A 280 and City of Norfolk v. Perry Co., 108 Va 28.) Thomason Park, Incorporated v. County of Prince William, Va (1954). § 17.1. Generally. § 17. Gifts and Donations A city wishes to make a gift of a sum of money to the Air Force to be used for the purchase of land upon which to construct an air base in the vicinity of the city. Held: The gift may be accepted only in accordance with the Act of 27 July 1954 (PL 537, 83rd Cong), under which the Secretary of the Treasury is authorized to accept any gift of money or other intangible personal property made on condition that it be used for a particular defense purpose. The gift cannot be accepted under the Act of 11 March 1948 (62 Stat 71, 5 USC 150q-t). The legislative history of this Act indicates that it was intended to be limited to gifts for the benefit of, or connection with, the establishment, operation, maintenance or administration of any school, hospital, library, museum, cemetery, or other institution or organization of a similar nature. The gift in the instant case would not fall within these categories. Op JAGAF 1955/1. 7 January 1955. II. PROCUREMENT OF PROPERTY § 31. Leases and Rentals § 31.43. Lessees; tenants. The government condemned for public use certain floors of a commercial building. At the time the floors were occupied by tenants. With a few exceptions, the leases of the tenants had expired, but the tenants continued to occupy the premises as statutory tenants under the provisions of the Commercial Rent Control Law of the State of New York. A number of these tenants submitted claims for costs and expenses alleged to have occurred as incidentals of their being required to remove from the condemned premises and to equip new quarters or space for the conduct of their future business activities. The leases under which the various tenants first went into possession contained clauses to the effect that if the whole or any part of the premises should be taken or condemned by competent authority for public or quasi public use then the term of the lease should terminate from the date when the possession of the part so taken should be required for such use and purpose and without apportionment of the award. Held: The claims cannot be allowed. Compensation for claims of the nature herein asserted can be allowed only where the government takes a portion of an unexpired leasehold estate leaving the tenant holding the remainder estate. In none of the claims herein is there any evidence that the tenants had an unexpired leasehold estate out of which the government was taking a part with the tenant holding the remainder. In all instances the tenant's leasehold estates as originally created, or as extended between the tenant and the landlord, had expired and the tenants were holding over solely under the benefit of rent control legislation which preserved their occupancy but did not change the nature and character of their leasehold estates. Furthermore, if any of the claimants had an unexpired leasehold estate which was prematurely terminated by the taking, such tenant would be without any right to compensation for the value of the unexpired leases by reason of the eminent domain clauses in the leases and any award for the use and occupancy of the premises by the government would be payable to the landlord and the tenants would not be entitled to any portion thereof. (Citing U. S. v. General Motors Corp., 323 US 373, 89 L ed 311, 65 S Ct 357; U. S. v. Petty Motor Co., 327 US 372, 90 L ed 729, 66 S Ct 596; U. S. v. Westinghouse Electric and Mfg. Co., 339 US 261, 94 L ed 816, 70 S Ct 644; U. S. v. 21,815 Square Feet of Land in Brooklyn, 59 F Supp 219, affd 155 F2d 898; U. S. v. 45,000 Square Feet, 62 F Supp 121 and other cases.) United States v. Fisk Building, 124 F Supp 259 (DC NY), 8 April 1954. III. MAINTENANCE, OPERATION, AND USE § 35. In General There is no provision of federal law prohibiting the placement of voting booths on Army installations to accommodate civilian employees living on the post. Installations commanders should, however, be cognizant of Federal statutes which provide penalties against the keeping of troops at election places and the interference in elections by members of the Armed Forces (18 USC 592, 593), and those which make unlawful the use of official authority by employees of the Federal executive and administrative branches for the purpose of interfering with or affecting the results of elections (sec 9, act of 2 Aug 1939, 53 Stat 1148, as amended 5 USC 118i (a); 18 USC 595). Held also: Adequate consideration must support the lease of or license to use a federally owned building as a polling place. This adequate consideration may consist of a money consideration or of maintenance, protection, repair or restoration of the leased property by the lessee. JAGA 1954/9121. 16 November 1954. § 39.1. Generally. § 39. Utility Services A civilian employee in charge of janitorial service and building maintenance at an armory occupied a house owned by the United States and located at the armory from 1 October 1950 to 27 February 1953. The orders under which he occupied the premises in question provided for a specified rental to be paid by payroll deductions and the employee testified before a board of officers investigating his case that he was told the rental included utilities. Held: The employee is indebted to the United States for the reasonable value of utilities furnished him during the period of occupancy. Under sec 3 of the act of 5 March 1928 (45 Stat 193, 5 USC 75a), where the Secretary of the Army has determined that conditions of employment require it, utilities may be furnished civilian employees at government expense provided the "reasonable value" of the utilities are administratively determined and considered part of the employee's compensation. However, regulations in effect during the period involved in the instant case and implementing sec 3 of the cited statute provided, in effect, that where a civilian employee occupies government quarters, utilities may not be provided at government expense. As these regulations are in implementation of statute, they may not be waived in individual cases, and accordingly there is no authority to cancel or waive the indebtedness of the employee herein. (Citing Army Regulations 100-90, 19 Apr 1943; AR 420-80, 30 Oct 1950; JAGA 1948/3926, 14 May 1948; JAGA 1946/11051, 17 Jan 1947; 21 Comp Dec 482, 484.) JAGA 1954/5352. 16 June 1954. |