Charges for Use of Airport Property

AIRPORTS--PORT DISTRICTS--FEES--PROPERTY--Charges for Use of Airport Property

1.  RCW 14.08.120(6) authorizes a port district to charge a fee to persons who use airport property.  However, this authority does not empower a port district to charge persons who do not use airport property, but who simply benefit from their proximity to airport property.

2.  RCW 14.08.120(6) provides that charges for the use of airport property shall be reasonable and uniform for the same class of service and established with due regard to the property and improvements used and the expense of operation to the municipality.  A charge based on a percentage of a user's gross receipts fails to meet these statutory requirements.

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                                                                 August 25, 1992

Honorable Mary Margaret Haugen
State Representative
331 John L. O'Brien Building
Post Office Box 40620
Olympia, Washington  98504-0620

                                                                                                                 Cite as:  AGO 1992 No. 18

Dear Representative Haugen:

            By letter previously acknowledged, you have asked for our opinion on two questions which we paraphrase as:

            1.   Under RCW 14.08.120(6) may a port district charge a fee to businesses that do not use airport property but benefit from their proximity to airport services?

            2.  May a port district charge fees to those businesses who use airport property and base the charge on a percentage of the user's gross receipts?

The answer to both questions is no.

                                                                    ANALYSIS

            Question 1:

            Under RCW 14.08.120(6) can a port district charge a fee to businesses that do not use airport property but benefit from their proximity to airport services?

            A port district is a municipal corporation.  RCW 53.04.060. A municipal corporation has only those powers expressly granted by statute or necessarily implied in the express grant of authority.  Tacoma v. Taxpayers, 108 Wn.2d 679, 692, 743 P.2d 793 (1987).  Courts are reluctant to imply municipal authority from statutes, unless it is legally necessary to meet the Legislature's original intent.  SeePort v. Utilities & Transp. Comm'n, 92 Wn.2d 789, 794-95, 597 P.2d 383 (1979).  See also RCW 14.08.120(7) (municipalities operating airports are authorized to exercise all powers which are necessarily incidental to the exercise of the general and special powers granted by the Legislature).

            A municipal corporation's powers are construed differently when it acts in its governmental rather than its proprietary capacity.  Hite v. Public Util. Dist. No. 2, 112 Wn.2d 456, 459, 772 P.2d 481 (1989).  Governmental municipal powers are strictly construed and, when a doubt exists, courts regularly hold that the Legislature did not authorize the particular action.  Port, 92 Wn.2d at 794-95; Tacoma, 108 Wn.2d at 692.

            Proprietary municipal powers, however, are not as strictly construed.  When exercising its proprietary powers, a municipal corporation may act in the same way as the proprietor of a private business.  Hite, 112 Wn.2d at 459; 2 E. McQuillin, Municipal Corporations, § 10.22 (3d rev. ed. 1988).

            Chapter 14.08 RCW, the Revised Airports Act, gives municipalities the governmental power to operate public airport facilities.  RCW 14.08.120(6) also gives a municipality the specific proprietary power

            [t]o determine the charges or rental for the use of any properties under its control and the charges for any services or accommodations, and the terms and conditions under which such properties may be used[.]

(Emphasis added.)

            The statute's clear wording tells us that the Legislature meant for port districts and other municipalities, as airport proprietors, to be able to charge businesses for the privilege of using airport property and services and to establish conditions for that private use.

            Accordingly, we believe that a port district has express authority to charge a fee[1]  to businesses that use airport property[2]  or services.  A fee could be charged, for example, to businesses that are located off airport property, but that use airport roads or services to make deliveries or to pick up customers.

            However, the Legislature empowered port districts to charge use fees only to those who actually use airport property or services.  Even though proprietary municipal powers are less strictly construed, it is our opinion that, under the clear wording of the Revised Airports Act, municipalities may not charge use fees to businesses that do not use airport property or services, but simply locate near the airport to take advantage of the customer base generated by the airport.

            Municipal corporations are given a great deal of discretion to decide how their proprietary powers will be exercised.  Courts will imply authority to "engage in any undertaking necessary to make [the proprietary venture] efficient and beneficial to the public."  Tacoma v. Taxpayers, 108 Wn.2d at 694-95.  This does not mean that municipal corporations may act "beyond the purposes of the statutory grant of power."  Id. at 695.  Therefore, while a port district has authority to determine the means by which it will charge for services or the use of property under its control, it may not exceed this statutory grant of authority by charging for uses other than those specifically listed in RCW 14.08.120(6).

            We also do not believe that port districts have the implied authority to charge use fees to businesses that simply benefit from the existence of the airport.  The test for implied municipal powers is legal necessity; that is, whether the power is necessarily or fairly implied in or incident to the powers expressly granted.  Port, 92 Wn.2d at 794-95;  Schmitt v. Cape George Sewer Dist. No. 1, 61 Wn. App. 1, 5, 809 P.2d 217 (1991).

            For example, in Port v. Utilities & Transp. Comm'n, the Port of Seattle argued the implied authority to operate its own airporter shuttle service.

            After reviewing the relevant statutes, the Washington Supreme Court rejected the port district's attempt to expand its express powers.  Instead, the court held that chapter 14.08 RCW, the very provision at issue here, and chapter 53.08 RCW, which defines certain powers of port districts, gave the port district only narrow proprietary power to contract with businesses to supply services like an airporter shuttle.

            Without express statutory authority, the port district was not able to simply declare that it needed to operate its own airporter service because the cost of a private contract was no longer economically viable.  Such an implication was not legally necessary for the Port of Seattle to operate its airport.

            We believe the same would be true if a port district suggested that it was legally necessary for it to charge fees to those who do not use airport property, but who simply benefit from their proximity to airport property.  Charging fees to such persons certainly is not necessary for the port district to exercise its express authority to charge fees for the use of property under its control.  Since it is not legally necessary, we conclude the port district has no implied authority to charge such a fee.

            Question 2:

            Can a port district charge fees to those businesses who use airport property and base the charge on a percentage of the user's gross receipts?

            The section of the Revised Airports Act that authorizes charges for using airport property or taking advantage of airport services states:

            Provided, That in all cases the public is not deprived of its rightful, equal, and uniform use of the [airport] property.   Charges shall be reasonable and uniform for the same class of service and established with due regard to the property and improvements used and the expense of operation to the municipality.

RCW 14.08.120(6) (emphasis added).

            The first part of this statute, quoted in Question 1, authorizes port districts to charge for the use of properties under their control, and for services and accommodations provided.  The portion of the statute quoted above imposes limitations on the port district's authority to assess such charges.  Charges for the use of property[3]  must satisfy three requirements:  the charges must be reasonable, uniform, and based upon the cost to the port district of owning and maintaining the property used.  We believe that a charge based on a percentage of gross receipts would fail to meet these statutory requirements.

            Charges based on the user's gross receipts are likely to result in different charges for businesses that use airport property in the same way and to the same extent.  Calculated in this way, charges would not be uniform, and would bear no relationship to the cost or operation of the property.

            This point can be illustrated by the following example.  It is our understanding that rental car companies are among the businesses that use airport property.  These rental car companies maintain offices in other locations, and use the airport's property by driving courtesy vans to and from passenger terminals to pick up and deliver their customers.  Assume that the charge is to be based on a rental car company's gross receipts from customers who arrive at the airport, are transported off the airport grounds in vans operated by the company, and rent a car from the company within 24 hours of arrival.  Assume further that the charge is 10 percent of these gross receipts.

            Company A picks up one customer at the airport on a given trip.  When the customer arrives at Company A's office, she rents a car for one day at a rate of $100.  The port district will charge Company A $10 for using airport property.

            Company B also picks up one customer at the airport on a given trip.  When the customer arrives at Company B's office, however, he rents a car for ten days at a rate of $100 per day, or $1,000 total.  Company B will be charged $100, or 10 times the amount charged to Company A, by the port district for its use of airport property.  Presumably, the expense to the port district of owning and operating the property used would be the same in both cases.  Yet the charges assessed the two companies would differ greatly.

            Our conclusion here is consistent with our opinion in AGO 61-62 No. 100.  There, we were asked whether a municipal corporation operating an airport had authority to impose a charge upon each passenger boarding an airplane at the airport.  The proposed charge would help defray the cost of providing boarding and landing facilities, as well as other facilities furnished for the convenience of passengers, such as waiting rooms and rest rooms.  Our analysis included a discussion of RCW 14.08.120(6), the statute that requires such charges to be, among other things, uniform.  We determined that a charge levied only on passengers leaving the airport, and not on those arriving at the airport, would not be uniform.  Both classes of passengers could be expected to use these facilities equally.  To be uniform, therefore, the charge would have to be levied on both.

            While the charge at issue in your request apparently would be levied on all companies using airport property in the same manner, the amount paid by each company would depend on that company's gross receipts.  As explained above, there is no necessary correlation between a company's gross receipts and its use of airport property.  Therefore, different companies would pay different charges for the same use.  We believe that this system of charges would be no more uniform than the charge discussed in AGO 61-62 No. 100.

            We are unable to envision a gross receipts measure that would uniformly consider the use of specific property and the cost to the airport of providing that use.  Examples of these types of costs might be the costs of maintaining airport drives and providing traffic control and security.

            A port district could, however, charge a per-trip fee to those actually using airport drives.  Such a charge would be based on the property used and the port district's cost of allowing the use.  Since the charge would be assessed on all businesses making use of the property in the same way, the charge would also be uniform.  This type of charge seems to be the type contemplated by the Revised Airports Act.[4]

            In conclusion, we believe that port districts may not base charges for the use of property under their control on a percentage of the user's gross receipts.[5]   Charges based on such a measure would contravene the statutory requirement that charges be uniform, and that they be established "with due regard to the property and improvements used and the expense of operation" to the district.  RCW 14.08.120(6).

            We trust that this opinion will assist you.

                                    Very truly yours,

                                    KENNETH O. EIKENBERRY
                                    Attorney General

                                    STEPHEN T. REINMUTH
                                    Assistant Attorney General

                                    TANYA BARNETT
                                    Assistant Attorney General

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