Voicestream GSM I Operating Co., LLC v. Louisiana Public Service Commission (2006)
From Judgepedia
| ||||||||
- Justice Johnson wrote the majority opinion, which held that a Government Agency Order requiring cell phone providers to pay into a fund for setting up rural phone service was a permissible "fee" rather than an unconstitutionally impermissible "tax," even though the eventual effect of these fees would be to pass on the costs to cell phone users rather than the general public.
ISSUES:
- The issue in this case was whether the plaintiff was correct in arguing that the forced contribution was an impermissible tax under Article 7, Section 1 of the Louisiana Constitution, rather than a permissible administrative fee, since it was not intended to defray costs incurred in the administration of any regulatory program, but intead was intended to be distributed to private businesses for the sole purpose of subsidizing the costs of rural telecommunication carriers."
HOLDING:
- The Majority held that the "principal object" of this forced contribution from cellular phone providers was not "the raising of revenue, but was merely incidental to the making of rules and regulations to promote public order, individual liberty, and general welfare," and was thus "an exercise of the police power."
MAJORITY REASONING:
- (1) Other courts in other states have held that "charges imposed to 'reallocate costs' between utilities or telecommunications companies are not taxes."
- (2) An assessment only amounts to a tax where "the primary purpose of the assessment is to raise revenue."
- (3) The Louisiana Public Service Commission is an expert in its own specialized field and ints interpretation and application of its own General Orders * * * deserves great weight * * *."
- (4) The Nebraska Supreme Court, Kansas Supreme Court, North Carolina Supreme Court, and a Michigan court all reached the conclusions that such an assessment was not a tax.
Additional reading
| |||||||||||||||||
