Appalachian Power v. WV Tax
Annotate this Case
September 1995 Term
_________
No. 22795
_________
APPALACHIAN POWER COMPANY, DUQUESNE LIGHT
COMPANY, MONONGAHELA POWER COMPANY,
OHIO POWER COMPANY, THE POTOMAC EDISON POWER
COMPANY, VIRGINIA ELECTRIC AND POWER
COMPANY, AND WEST PENN POWER COMPANY,
Plaintiffs Below, Appellants
V.
STATE TAX DEPARTMENT OF WEST VIRGINIA
AND CHARLES O. LORENSEN, STATE TAX
COMMISSIONER OF WEST VIRGINIA,
Defendants Below, Appellees
_______________________________________________________________
APPEAL FROM THE CIRCUIT COURT OF KANAWHA COUNTY
HONORABLE PAUL ZAKAIB, JR., JUDGE
CIVIL ACTION NO. 90-C-1213
AFFIRMED
_______________________________________________________________
Submitted: September 20, 1995
Filed: December 8, 1995
Robert E. Magnuson Louis S. Southworth II
William W. Booker Jackson & Kelly
Kay, Casto, Chaney, Love & Wise Charleston, West Virginia
Charleston, West Virginia Attorney for Appellants
Attorneys for Appellants Appalachian Monongahela Power Company,
Power Company, Duquesne Light The Potomac Edison Power
Company, and Ohio Power Company Company, Virginia Electric
and Power Company, and
Silas B. Taylor West Penn Power Company
Managing Deputy Attorney General
Attorney for Appellees
JUSTICE CLECKLEY delivered the Opinion of the Court.
RETIRED JUSTICE MILLER sitting by temporary assignment.
JUSTICE ALBRIGHT did not participate.
SYLLABUS BY THE COURT
1. Interpreting a statute or an administrative rule or regulation presents a
purely legal question subject to de novo review.
2. In reviewing a rule or regulation of an administrative agency, a West
Virginia court must first decide whether the rule is interpretive or legislative. If it is
interpretive, a reviewing court is to give it only the deference it commands. If it is a
legislative rule, the court first must determine its validity. Assuming its validity, the two-
pronged analysis from Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984), should be applied.
3. Judicial review of an agency's legislative rule and the construction of
a statute that it administers involves two separate but interrelated questions, only the second
of which furnishes an occasion for deference. In deciding whether an administrative
agency's position should be sustained, a reviewing court applies the standards set out by the
United States Supreme Court in Chevron U.S.A., Inc. v. Natural Resources Defense Council,
Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694 (1984). The court first must ask
whether the Legislature has directly spoken to the precise question at issue. If the intention
of the Legislature is clear, that is the end of the matter, and the agency's position only can
be upheld if it conforms to the Legislature's intent. No deference is due the agency's
interpretation at this stage.
4. If legislative intent is not clear, a reviewing court may not simply
impose its own construction of the statute in reviewing a legislative rule. Rather, if the
statute is silent or ambiguous with respect to the specific issue, the question for the court is
whether the agency's answer is based on a permissible construction of the statute. A valid
legislative rule is entitled to substantial deference by the reviewing court. As a properly
promulgated legislative rule, the rule can be ignored only if the agency has exceeded its
constitutional or statutory authority or is arbitrary or capricious. W. Va. Code, 29A-4-2
(1982).
5. "'Rules and Regulations of . . . [an agency] must faithfully reflect the
intention of the legislature; when there is clear and unambiguous language in a statute, that
language must be given the same clear and unambiguous force and effect in the . . .
[agency's] Rules and Regulations that it has in the statute.' Syl. pt. 4, Ranger Fuel Corp. v.
West Virginia Human Rights Commission, 180 W. Va. 260, 376 S.E.2d 154 (1988)." Syl.
pt. 2, in part, Chico Dairy Company v. Human Rights Commission, 181 W. Va. 238, 382 S.E.2d 75 (1989).
6. "The concept of equal protection of the laws is inherent in article three,
section ten of the West Virginia Constitution, and the scope and application of this protection
is coextensive or broader than that of the fourteenth amendment to the United States
Constitution." Syl. pt. 3, Robertson v. Goldman, 179 W. Va. 453, 369 S.E.2d 888 (1988).
7. "A state by its legislature may make reasonable classifications in
enacting statutes provided the classifications are based on some real and substantial relation
to the objects sought to be accomplished by the legislation, and a person who assails any
such classification has the burden of showing that it is essentially arbitrary and
unreasonable." Syl pt. 5, United Fuel Gas Co. v. Battle, 153 W. Va. 222, 167 S.E.2d 890,
appeal dismissed, cert. denied, United Fuel Gas Co. v. Haden, 396 U.S. 116, 90 S. Ct. 398,
24 L. Ed. 2d 309 (1969).
Cleckley, Justice:
The plaintiffs below and appellants herein, Appalachian Power Company, et
al.,See footnote 1 appeal an order of the Circuit Court of Kanawha County finding that a legislative
regulation, 110 W. Va. C.S.R. 13, §1 A. 2.11 (1990), is a valid and enforceable regulation
properly interpreting W. Va. Code, 11-13-2n(a)(1) (1990).See footnote 2 In reaching its decision, the
circuit court found there was no express or implied deduction for company use or line loss
provided in W. Va. Code, 11-13-2n(a)(1). In its order, the circuit court rejected each of the
plaintiffs' exceptions. We affirm this ruling.
I.
FACTS AND PROCEDURAL HISTORY
A general overview of this litigation is necessary for a proper resolution of the
issues upon which we granted the petition for appeal. During the First Extraordinary Session
of 1989, the West Virginia Legislature enacted the West Virginia Fiscal Responsibility Act of 1989, which imposed additional taxes. One of the new sections, W. Va. Code, 11-13-2n,
taxed the "net generation [of electricity] available for sale[.]"
In June, 1989, the Tax Commissioner filed a proposed regulation that
interpreted W. Va. Code, 11-13-2n. This initial proposed regulation defined company use
and line loss and permitted plaintiffs to deduct these two costs in order to determine the "net
generation available for sale."See footnote 3 The attorneys for some of the plaintiffs wrote to the State
Tax Department, one of the defendants below and appellees herein, concerning the June, 1989, regulation. These plaintiffs noted they agreed with the Tax Commissioner's general
definitions, but objected to the 1.5 percent cap on line loss as being arbitrary.
Subsequently, in August, 1989, the Tax Commissioner changed his position
and issued a revised set of proposed rules interpreting W. Va. Code, 11-13-2n. These
revised rules prohibited the deduction of either line loss or company use to determine "net
generation available for sale." The revised regulation provides:
"1 A. 2.11 'Kilowatt hours of net generation
available for sale that was generated or produced in this State'
means gross West Virginia electric energy generation less
station use, as defined in these regulations. 'Kilowatt hours of
net generation available for sale that was generated or produced
in this State' shall not be reduced by company use, line loss or
any other use, loss or deduction, except station use, as defined
in these regulations.
"1 A. 2.12 'Line loss' means loss of electrical
energy by electrical resistance and electromagnetism occurring
from or in electrical transmission lines or apparatus between any
two points along such transmission lines or apparatus."
(Emphasis added).See footnote 4
The Tax Commissioner also issued a document entitled "Public Comments on the Business
and Occupation Tax Regulations Filed on October 12, 1989" and "Agency Approved West
Virginia Legislative Regulations." On October 12, 1989, the Tax Commissioner filed
another "Notice of a Comment Period On a Proposed Rule," which permitted comments up
to November 13, 1989.
Incident to consideration of the proposed rule by the Legislature, Deborah A.
Graham, counsel to the Legislative Rulemaking Committee, prepared a written analysis of
the revised rule. Ms. Graham noted that the revised rule conflicted with the statute. The
analysis specifically noted "[i]t is counsel's opinion that the language of the statute is clear
and unambiguous when it refers to net generation available for sale and that the intent of the
statute is to tax that electricity which is ultimately sold to the consumer." (Emphasis in
original). The Tax Commissioner responded to Ms. Graham's analysis in a letter dated
November 3, 1989. According to this letter, the original regulations were changed because
they were based on an erroneous interpretation by the drafters. At a hearing on November
14, 1989, the Legislative Rulemaking Committee approved the revised rule. The Legislature passed an omnibus bill approving promulgation of the regulations proposed by various
executive agencies on March 10, 1990. Under the authority of that act, the rules involved
here were promulgated by the Tax Commissioner to be effective August 31, 1990.
The plaintiffs filed a complaint in the Circuit Court of Kanawha County stating
four claims for relief: (1) statutory authority and jurisdiction was exceeded; (2) emergency
rules are invalid and unenforceable; (3) the defendants failed to provide a statutory comment
period; and (4) the administrative exemption of certain manufacturers, but not the plaintiffs,
violated equal protection principles. The plaintiffs eventually withdrew their claims for
relief based on the failure to provide a statutory comment period and on the unenforceability
of emergency rules.
Following a one-day trial, the circuit court signed and filed, without
modification, the "Proposed Findings of Fact and Conclusions of Law of Defendants State
Tax Commissioner and State Tax Department." On September 23, 1994, the court entered
an "Amended Final Order" that corrected the caption of the final order, but made no further
modifications. In the final order, the circuit court (1) dismissed the procedural counts of the
complaint abandoned by the plaintiffs; (2) held the challenged regulation was valid; (3) held
W. Va. Code, 11-13-2n(a)(1) did "not contain an express or implied deduction for post-
generation, post-transmission 'company use' or for any 'line loss' occurring after the point of generation"; and (4) held that exempting the tax generation of manufacturers did not violate
the Equal Protection Clause.
On appeal, the plaintiffs assert the language of W. Va. Code, 11-13-2n, is clear
and unambiguous and, as a matter of law, excludes company use and line loss from the
calculation of "net generation [of electricity] available for sale." It is also argued that the
legislative regulation, 110 W. Va. C.S.R. 13, §1 A. 2.11, is unconstitutional because it attempts
to improperly exercise the authority of the Legislature and violates equal protection
principles by excluding manufacturers that generate electric power for their own use without
providing similar exclusions for the plaintiffs. The defendants, on the other hand, argue that
(1) production taxes are traditionally based on quantities produced for sale and not on
quantities actually delivered to the retail market, (2) the Tax Commissioner's interpretation
is entitled to great weight, and (3) the plaintiffs' equal protection argument has no factual or
legal basis.
II.
DISCUSSION
We take up two questions: (1) whether the clear language of W. Va. Code,
11-13-2n, precludes the Tax Department's interpretation of the power companies' tax burdens
as embodied in 110 W. Va. C.S.R. 13, §1 A. 2.11; and (2) whether the rule in question impermissibly differentiates between like entities and thereby violates equal protection
principles. We examine each in turn.
A.
W. Va. Code, 11-13-2n
As stated above, the defendants' interpretation of W. Va. Code, 11-13-2n
defines the words "kilowatt hour of net generation available for sale" to include company use
and line loss, 110 W. Va. C.S.R. 13 §1 A. 2.11. The plaintiffs argue that company use and line
loss should be excluded from the "net generation available for sale" because such expenses
are not amounts that are actually available for sale. Our ultimate task is to determine
whether the disputed statutory language is ambiguous and, if so, whether the defendants'
interpretation is a reasonable and permissible construction of the statute.
Interpreting a statute or a regulation presents a purely legal question subject
to de novo review.See footnote 5 See State ex rel. McGraw v. Scott Runyan Pontiac-Buick, Inc., ___ W. Va. ___, ___, 461 S.E.2d 516, 523 (1995); Mildred L.M. v. John O.F., 192 W. Va. 345,
350, 452 S.E.2d 436, 441 (1994). Nevertheless, the availability of plenary judicial review
"does not obviate the devoir of persuasion in a . . . [taxation] case in which a plaintiff
challenges the validity of the regulatory mosaic." Commonwealth of Massachusetts, Dept.
of Public Welfare v. Secretary of Agric., 984 F.2d 514, 521 (1st Cir.), cert. denied sub nom.
Massachusetts Dept. of Public Welfare v. U.S., ___ U.S. , 114 S. Ct. 81, 126 L. Ed. 2d 49
(1993). An inquiring court--even a court empowered to conduct de novo review--must
examine a regulatory interpretation of a statute by standards that include appropriate
deference to agency expertise and discretion.
Judicial review of an agency's construction of a statute that it administers
involves two separate but interrelated questions, only the second of which furnishes an
occasion for deference. We discussed this rule of statutory construction in our recent case
of Sniffin v. Cline, 193 W. Va. 370, ___, 456 S.E.2d 451, 454-55 (1995):
"In deciding whether the DMV's position should be sustained,
we apply the standards set out by the United States Supreme
Court in Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed. 2d 694
(1984). We first ask whether the Legislature has 'directly
spoken to the precise [legal] question at issue.' Chevron, 467 U.S. at 842, 104 S. Ct. at 2781, 81 L. Ed. 2d at 702-03. 'If the
intention of the Legislature is clear, that is the end of the matter.'
Id. If it is not, we may not simply impose our own construction
of the statute. 'Rather, if the statute is silent or ambiguous with
respect to the specific issue, the question for the court is
whether the [DMV's] answer is based on a permissible
construction of the statute.' Chevron, 467 U.S. at 843, 104 S. Ct. at 2782, 81 L. Ed. 2d at 703. See Pauley v. BethEnergy
Mines, Inc., 501 U.S. 680, 696-98, 111 S. Ct. 2524, 2534, 115 L. Ed. 2d 604, 623-25 (1991). In the present case, it is clear that
the Legislature has not spoken to the precise question at issue.
Therefore, we review the DMV's decision to determine whether
its construction is one the Legislature would have sanctioned.
See United States v. Shimer, 367 U.S. 374, 383, 81 S. Ct. 1554, 1560-61, 6 L. Ed. 2d 908, 915 (1961)."
Once again, Chevron and its progeny provide the analytical framework for our
decision.See footnote 6 We must first determine how the Chevron analysis is affected by legislative rules in West Virginia and our recent decision in Kincaid v. Mangum, 189 W. Va. 404, 432 S.E.2d 74 (1993), that precludes us from giving controlling weight to omnibus bill legislation
without first giving it careful scrutiny.
Under West Virginia law, there are three types of rules--legislative,
interpretive, and procedural. We are not concerned with procedural rules in this case.
Legislative rules are those "affecting private rights, privileges or interests," in what amounts
to a legislative act. W. Va. Code, 29A-1-2(i) (1982). Legislative rules have "the force of
law[.]" W. Va. Code, 29A-1-2(d) (1982). See also Chico Dairy Co. v. West Va. Humans
Rights Comm'n, 181 W. Va. 238, 382 S.E.2d 75 (1989) (to be valid, the promulgation of
legislative rules must be authorized by the West Virginia Legislature). Interpretive rules, on
the other hand, do not create rights but merely clarify an existing statute or regulation. See
W. Va. Code, 29A-1-2(c) (1982). Because they only clarify existing law, interpretive rules need not go through the legislative authorization process. See W. Va. Code, 29A-3-1, et
seq.; Chico Dairy Co. v. West Virginia Humans Rights Comm'n, supra. Although they are
entitled to some deference from the courts,See footnote 7 interpretive rules do not have the force of law
nor are they irrevocably binding on the agency or the court.See footnote 8 They are entitled on judicial
review only to the weight that their inherent persuasiveness commands. We believe that
Gilbert furnishes the appropriate analysis for reviewing interpretive rules:
"'We consider that the rulings, interpretations and
opinions of the Administrator under this Act, while not
controlling upon the courts by reason of their authority, do
constitute a body of experience and informed judgment to which
courts and litigants may properly resort for guidance. The
weight of such a judgment in a particular case will depend upon
the thoroughness evident in its consideration, the validity of its
reasoning, its consistency with earlier and later pronouncements,
and all those factors which give it power to persuade, if lacking
power to control.'" 429 U.S. at 141-42, 97 S. Ct. at 411, 50 L. Ed. 2d at 357-58, quoting Skidmore, 323 U.S. at 140, 65 S. Ct.
at 164, 89 L. Ed. at 129.
Most of our cases fail to make a distinction between legislative and interpretive rules for
purposes of rule construction.See footnote 9 This failure justifiably follows from the fact that legislative
rules in West Virginia are authorized by acts of the Legislature and we have treated them,
as they should be, as statutory enactments. What distinguishes interpretive rules from
legislative rules is the legal base upon which the rules rest. What complicates our path today
is the Legislature's practice of approving legislative rules as part of omnibus legislation. To
divine the nature and the validity of the rule in this case, it is helpful to understand the nature
of omnibus legislation generally and the problems created by this manner of legislating. We,
therefore, find it necessary to address the applicability of Chevron to both legislative rules
in West Virginia and more pertinent to omnibus legislation.
The plaintiffs attack the constitutionality of 110 W. Va. C.S.R. 13, §1 A. 2.11
asserting the Legislature violated the one-object rule and generally exercised its authority in
an unconstitutional manner by adopting the regulation in question through an omnibus bill.
Section 30 of Article VI of the West Virginia Constitution states that legislation may embrace only one subject, which must be expressed in its title. As discussed in Kincaid, the
purpose of these requirements is (1) to prevent from combining into one bill several diverse
measures which have no common basis and which are combined together out of fear that
separately each could not receive a favorable vote on its merits; (2) to prevent the
unintentional and unknowing passage of provisions inserted in a bill for which the title gives
no information; and (3) to fairly apprise the public of matters which are contained in the
various bills and to prevent fraud and deception as to matters passed by the Legislature.
Although not pertinent here, a fourth justification might be to prevent the dilution of a
governor's veto power that would result if the legislation is saddled with irrelevant riders
opposed by a governor. See generally, Millard H. Ruud, "No Law Shall Embrace More than
One Subject", 42 Minn. L. Rev. 389 (1958).
The plaintiffs concede that Kincaid clearly establishes two propositions: "(1)
That the practice of enacting legislative rules in an omnibus bill is prospectively invalid; and
(2) That rules previously enacted in that manner must be given special scrutiny." In Syllabus
Point 1 of Kincaid v. Mangum, supra, this Court discussed the importance of the Legislature
exercising its authority in an appropriate manner:
" 'While the Legislature has the power to void or
to amend administrative rules and regulations, when it exercises
that power it must act as a legislature, within the confines of the
enactment procedures mandated by our constitution. It cannot
invest itself with the power to act as an administrative agency in
order to avoid those requirements.' Syl. pt. 2, State ex rel.
Barker v. Manchin, 167 W. Va. 155, 279 S.E.2d 622 (1981)."
We found that legislating by an omnibus bill violates the one-object rule, however, we also
found that because of the severe burden it would place on the Legislature and State agencies,
the Kincaid holding would apply only prospectively.See footnote 10
The omnibus bill in question is a prime example of the potential evils that
could "lead to logrolling or other deceiving tactics[.]" Syl. pt. 2, in part, Kincaid v. Mangum,
supra. The omnibus bill in the case sub judice was passed in 1990. Kincaid was not decided
until 1993. Because of our determination that Kincaid should have prospective application
only, we refuse to declare the rule in this case unconstitutional. On the other hand, Kincaid
requires that we give the rule careful scrutiny.
In doing so, we underscore the importance of the legislative process that led
to its approval by the West Virginia Legislature. Chico Dairy Co. v. West Virginia Human
Rights Comm'n, supra. This process required the proposed rule go through two distinct
review stages. First, the proposed regulation was reviewed by a legislative rulemaking committee.See footnote 11 Second, the committee's final responsibility was to make a recommendation
to the full Legislature either to authorize the agency to promulgate the proposed rule or to
take other curative action. Significantly, under W. Va. Code, 29A-3-11(d), the committee
was required to include language in the bill authorizing the legislative rule in the form of a
legislative finding "that the rule is within the legislative intent of the statute which the rule
is intended to implement, extend, apply or interpret[.]"
Once a disputed regulation is legislatively approved, it has the force of a statute
itself. Under ordinary circumstances, an omnibus bill should be independently evaluated
under the first stage of the Chevron analysis. Being an act of the West Virginia Legislative,
it is entitled to more than mere deference; it is entitled to controlling weight. As authorized
by legislation, a legislative rule should be ignored only if the agency has exceeded its
constitutional or statutory authority or it is arbitrary or capricious. See West Virginia Code,
29A-4-2 (1982). Under this scenario, unless we are persuaded by the plaintiffs' arguments
attacking the rule's constitutionality, or for other reasons stated above, the plaintiffs must lose
under the "clear legislative intent" doctrine. We, however, have decided to give the plaintiffs
the benefit of the doubt and evaluate the omnibus bill and the legislative rule under the
second stage of Chevron consistent with our mandate in Kincaid requiring that omnibus bills
be given careful scrutiny.See footnote 12 As will be discussed more fully below, we have examined the
legislative history leading up to the pertinent section of the omnibus bill and we find it was
given specific, careful, and appropriate legislative consideration. Additionally, there are two
presumptions that cannot be ignored. First, the Legislature is presumed to have known and
understood the laws they had earlier enacted. State ex rel. Smith v. Maynard, 193 W. Va. ___, ___, 454 S.E.2d 46, 53-54 (1994). Second, "'courts must presume that a legislature says
in a statute what it means and means in a statute what it says there.'" Martin v. Randolph
County Board of Education, ___ W. Va. ___, ___, ___ S.E.2d ___, ___ (No. 22680
11/17/95) (Slip op. at 31), quoting Connecticut Nat'l Bank v. Germain, 503 U.S. 249, 253-54,
112 S. Ct. 1146, 1149, 117 L. Ed. 2d 391, 397 (1992).
To recapitulate, in reviewing a rule or regulation of an administrative agency,
a reviewing court must first decide whether the rule is interpretive or legislative. If it is
interpretive, a reviewing court is to give it only the deference it commands after considering
the factors discussed in Skidmore. If it is a legislative rule, the court first must determine the
rule's validity under Chico and Kincaid. Assuming validity, the appropriate level of
consideration due it depends on its clarity as a legislative rule. If the legislative rule is valid,
clear as to its intent and not contrary to the legislative enactment that triggered its
promulgation, the need for further review does not arise. It becomes the court's duty to apply
the rule as written. This in essence is the first step of Chevron. If the rule is valid under
Chico, meaning it has gone through the legislative review committee process and has been
authorized into law by the Legislature, but was approved as part of omnibus legislation that
we condemned in Kincaid necessitating careful scrutiny, we proceed to step two of the Chevron analysis.See footnote 13 In step two, we are limited to reviewing whether the agency's
construction is "permissible."
In performing the first part of the Chevron analysis, no deference is due the
agency. Instead, a court must look primarily to the plain meaning of the statute, drawing its
essence from the "particular statutory language at issue, as well as the language and design
of the statute as a whole." K Mart Corp. v. Cartier, Inc., 486 U.S. 281, 291, 108 S. Ct. 1811,
1818, 100 L. Ed. 2d 313, 324 (1988). Accord In re Snuffer, 193 W. Va. 412, ___, 456 S.E.2d 493, 497 (1995). Beyond this point, it remains unclear whether or to what extent, a
court engaged in the first stage of a Chevron inquiry may use other tools of statutory
construction, such as legislative history and post-enactment statements of the legislators and
their staffs, in searching for the Legislature's unambiguously expressed intent on a particular
issue.See footnote 14
Legislative history and other tools of statutory construction are subject to many
and varied criticisms, and the uncertainty about their value in general parallels the uncertainty about their value in relation to the Chevron doctrine. Respectable authority
indicates it is appropriate to employ all the "traditional tools of statutory construction" in the
first part of the Chevron analysis when the statutory language itself is not dispositive. See
INS v. Cardoza-Fonseca, 480 U.S. 421, 432-43, 107 S. Ct. 1207, 1213-19, 94 L. Ed. 2d 434,
448-55 (1987) (examining legislative history to confirm the validity of an interpretation
suggested by the statute's language) (dictum). But there is also respectable support for the
proposition that the Chevron analysis, at least in its initial phase, does not look beyond the
statutory text. See, e.g., National R.R. Passenger Corp. v. Boston & Me. Corp., 503 U.S. 407, 517, 112 S. Ct. 1394, 1401, 118 L. Ed. 2d 52, 66 (1992) (deference is due so long as
"the agency interpretation is not in conflict with the plain language of the statute"); K Mart
Corp. v. Cartier, Inc., 486 U.S. at 292, 108 S. Ct. at 1818, 100 L. Ed. 2d at 324 ("[i]f the
agency regulation is not in conflict with the plain language of the statute, a reviewing court
must give deference to the agency's interpretation of the statute"); NLRB v. United Food &
Commercial Workers Union, 484 U.S. 112, 133-34, 108 S. Ct. 413, 426-27, 98 L. Ed. 2d 429, 448-49 (1987) (Scalia, J., concurring) (criticizing dictum in Cardoza-Fonseca); State
by Davis v. Hix, 141 W. Va. 385, 389, 90 S.E.2d 357, 359-60 (1955) ("[w]here the language
of . . . [a] statute is of doubtful meaning or ambiguous, rules of construction may be resorted
to and the construction of such statute by the person charged with the duty of executing the
same is accorded great weight").
We think the difference between these two views may, as a practical matter,
be more apparent than real. In any event, we do not believe the outcome in this case would
be different even if we were to consider legislative history and use other tools of statutory
construction at the initial stage of the Chevron analysis. Thus, we need not precisely define
the function, if any, of legislative history under Chevron at this time. Rather, we assume
arguendo, but do not decide, that an inquiring court may look in that direction during the
initial stage of a Chevron inquiry.See footnote 15 Thus, in determining whether the Legislature has
directly spoken to the issues, we will consider not only the plain language of the statute but
any pertinent preenactment legislative history.See footnote 16
On this assumption, the question whether the Legislature has spoken on a
particular question involves two smaller steps. We look first to the statute's language. If the
text, given its plain meaning, answers the interpretive question, the language must prevail
and further inquiry is foreclosed. As we noted in Syllabus Point 2, in part, of Chico Dairy
Company v. Human Rights Commission, supra:
"'Rules and Regulations of . . . [an agency] must faithfully
reflect the intention of the legislature; when there is clear and
unambiguous language in a statute, that language must be given
the same clear and unambiguous force and effect in the . . .
[agency's] Rules and Regulations that it has in the statute.' Syl.
pt. 4, Ranger Fuel Corp. v. West Virginia Human Rights
Commission, 180 W. Va. 260, 376 S.E.2d 154 (1988)."
If no such readily apparent meaning springs from the statute's text, we next examine, albeit
skeptically, other extrinsic sources, such as the legislative history, in search of an
unmistakable expression of legislative intent. "When a statute's language is ambiguous, a
court often must venture into extratextual territory in order to distill an appropriate
construction. Absent explicatory legislative history for an ambiguous statute . . . , this Court
is obligated to consider the . . . overarching design of the statute." State ex rel. McGraw v.
Scott Runyan Pontiac-Buick, Inc., ___ W. Va. at ___, 461 S.E.2d at 523. And if, at that stage, the statute itself, viewed in connection with the statutory design and the legislative
history, reveals an unequivocal answer to the interpretive question, the Court's inquiry ends.
It is only when these efforts do not permit a court to discern an unmistakably
clear expression of legislative intent that the Chevron inquiry moves into its second stage.
Until then, deference is not a consideration--but from that point forward, deference looms
large.See footnote 17 Under this second stage, a court must examine the agency's interpretation to see how it relates to the statute. This examination involves a high degree of respect for the agency's
role. As we noted in Syllabus Point 7, in part, of Lincoln County Board of Education v.
Adkins, 188 W. Va. 430, 424 S.E.2d 775 (1992): "'"Interpretations of statutes by bodies
charged with their administration are given great weight unless clearly erroneous."'"
(Citations omitted). See also Syl. pt. 2, West Va. Dep't of Health v. Blankenship, 189 W.
Va. 342, 431 S.E.2d 681 (1993); Boley v. Miller, 187 W. Va. 242, 418 S.E.2d 352 (1992);
Blennerhassett Historical Park v. Public Serv. Comm'n of W. Va., 179 W. Va. 250, 366 S.E.2d 758 (1988). Thus, in this case, the Tax Commissioner need not write a rule that
serves the statute in the best or most logical manner; he need only write a rule that flows
rationally from the statute.
Our power to review the Tax Commissioner's decisions on policy grounds is
extremely limited. We are not at liberty to affirm or overturn the Commissioner's regulation
or decision merely on the basis of our agreement or disagreement with his policy
implications, even when important issues of taxation are at stake. This Court has stressed
the importance of liberally permitting administrative agencies to carry out legislative dictates;
we have recognized that aggressive judicial intervention would disrupt agency processes and
negate the legislative body's legitimate delegation of authority. See Frymier-Halloran v. Paige, ___ W. Va. ___, ___, 458 S.E.2d 780, 787 (1995) ("[d]espite the absence of specific
[constitutional] treatment, we have developed doctrines that attempt to define the
constitutional role for administrative agencies and to protect them from legislative and
judicial overreaching"). We are keenly aware of the invaluable role various agencies play
in making government operate efficiently. Thus, we are loathe to engage in the arduous task
of rewriting legislation, regulations, and agency structure simply on the whims of a few who
have expressed dissatisfaction with an agency's action. We will not set aside a formally
adopted legislative rule without clearcut evidence of an inconsistency between the rule and
the authorizing statute.
On the other hand, courts do play an important role in the implementation of
legislation by acting as a safeguard against bureaucratic excesses. At least under Chevron,
there is a legitimate role for judicial review of legislative rules.See footnote 18 Courts are commanded by
Chevron to give deference to certain legal conclusions of an agency. But deference "cannot
be allowed to slip into a judicial inertia which results in the unauthorized assumption by an
agency of major policy decisions properly made by" the Legislature. Bureau of Alcohol,
Tobacco and Firearms v. Federal Labor Relations Authority, 464 U.S. 89, 97, 104 S. Ct. 439, 444, 79 L. Ed. 2d 195, 202 (1983) (Citation omitted). Judicial review must not become
judicial abdication, and we must carefully consider each case to determine whether deference
is warranted and, if so, how much to accord. Joseph F. Weis, Jr., A Judicial Perspective On
Deference to Administrative Agencies: Some Grenades From the Trenches, 2 Admin.L.J.
301, 307 (1988).See footnote 19
When a legislative rule is constitutionally acceptable, only an unambiguous
conflicting statute, contradictory legislative history, a defect in the rulemaking process,
evidence of bias or abuse of power, or some other startling revelation of fact would
overcome the clearly erroneous burden and justify this Court's interference with an agency's
legitimate rulemaking authority. See Frymier-Halloran v. Paige, ___ W. Va. ___, ___, 458 S.E.2d 780, 787 (1995) ("[i]t [is] evident that courts will not override administrative agency decisions, of whatever kind, unless the decisions contradict some explicit constitutional
provision or right, are the results of a flawed process, or are either fundamentally unfair or
arbitrary"). See also Detch v. Board of Educ. of County of Greenbrier, 145 W. Va. 722, 729,
117 S.E.2d 138, 142 (1960), quoting 73 C.J.S. Public Administrative Bodies and Procedure
§ 104 ("'[i]t is only where an administrative rule or regulation is completely without a
rational basis, or where it is wholly, clearly, or palpably arbitrary, that the court will say that
it is invalid'"). MCI Telecommunications Corp. v. Federal Communications Comm'n, 675 F.2d 408, 413 (D.C. Cir. 1982) ("the critical concern of the reviewing court is that the agency
provide a coherent and reasonable explanation of its exercise of discretion"). Of course, if
the intent of the Legislature is clear, that intent will trump any agency's rule to the contrary.
As the United States Supreme Court noted in Chevron, where the Legislature has spoken
directly to a question, "the court, as well as the agency, must give effect to . . . th[at]
unambiguously expressed intent[.]" 467 U.S. at 842-43, 104 S. Ct. at 2781, 81 L. Ed. 2d at
703. (Emphasis added). Thus, a regulation both must implement the statutory purpose and
must have a rational basis supporting its adoption.
The Legislature may specifically provide the exact issues to be considered
when promulgating a rule. However, "[i]n the absence of . . . [legislative] direction as to
what elements are to be considered in promulgating . . . [a] rule, the presumption is that . .
. [the Legislature] is entrusting the decision as to what to consider to the hands of the agency
in deference to agency expertise." Kennedy v. Block, 606 F. Supp. 1397, 1403 (W.D. Va. 1985), vacated on other grounds 784 F.2d 1220 (4th Cir. 1986). We believe that if the
Legislature explicitly leaves a gap in legislation, then an agency has authority to fill the gap
and the agency is entitled to deference on the question. Thus, agency's interpretation will
stand unless it is "arbitrary, capricious, or manifestly contrary to the statute." Chevron, 467 U.S. at 844, 104 S. Ct. at 2782, 81 L. Ed. 2d at 703. The policy favoring deference is
particularly important where, as here, a technically complex statutory scheme is backed by
an even more complex and comprehensive set of regulations. Under such circumstances, the
argument for deference is at its strongest.
In this case, considering the totality of the circumstances, we find the
legislative intent favoring the regulation to be clear and the contested regulation comports
with the language of W. Va. Code, 11-13-2n.See footnote 20 We find the contested words "kilowatt hours of net generation available for sale" are ambiguous. The failure of the Legislature to define
these words or to enumerate any factors that the Tax Commissioner must consider in
deciding such circumstances or characteristics evidences an intent to delegate that
determination to the Tax Commissioner. Because this ambiguity cannot be resolved either
by preenactment legislative history or by a review of the overarching design of the original
statute, the statute is subject to reasonable construction by the administrative agency charged
with the duty to carry out these statutory objectives--the defendants (the Tax Department and
the Tax Commissioner).
At this juncture, we move to the second stage of the Chevron inquiry. We must
examine the defendants' interpretation to see how it relates to the statute and to determine whether the defendants' interpretation of W. Va. Code, 11-13-2n, is reasonable.See footnote 21 As
emphasized above, this examination involves a high degree of respect for the Tax
Department's and the Tax Commissioner's role.
Without question, the Legislature intended the defendants, the Tax Department
and the Tax Commissioner, to have the authority to interpret W. Va. Code, 11-13-2n. In
fact, W. Va. Code, 11-1-1 (1967), and W. Va. Code, 11-1-2 (1933), describe the creation,
structure, and duties of the Tax Department and its personnel. Specifically, W. Va. Code,
11-1-2, provides, in part, that it is the Tax Commissioner's duty to "see that the laws
concerning the assessment and collection of all taxes and levies, whether of the State or of
any county, district or municipal corporation thereof, are faithfully enforced." Obviously,
W. Va. Code, 11-13-2n, fits within the Tax Department's area of expertise.
The parties vigorously debate the appropriate definition of "net generation
available for sale." The words "net generation" suggest that the Legislature intended for something to be deducted in order to determine the net of all the electricity generated.See footnote 22
Basically, these words when viewed in isolation have little meaning. The plaintiffs assert
the words "available for sale" mean that any electricity generated that is not specifically
charged to a customer should be excluded from taxation. The defendants agree the words
"available for sale" are indeed definitive, but assert they define the companies to be taxed,
not the time the available electricity becomes subject to the tax. Specifically, the defendants
assert that the words "available for sale" is the Legislature's way of limiting the application
of the "electricity manufacturing tax to businesses which generate power for the purpose of
selling such power" to others. (Emphasis in original). Both constructions are consistent with
the statute's language. It is here that the Chevron analysis strikes its most telling blow to the
plaintiffs. Under Chevron, we may not impose our own construction of the statute.See footnote 23 Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the
Court is whether the Tax Commissioner's answer is based on a permissible construction of
the statute. Chevron, 467 U.S. at 843, 104 S. Ct. at 2782, 81 L. Ed. 2d at 703. Given the
competing policy concerns behind the statute and the industries affected, the language of the
statute suggests the Legislature intended the Tax Commissioner to strike the appropriate
balance of the goals of the statute in defining "net generation available for sale."
Although not aggressively pursued by the plaintiffs, they make reference to the
contention that the defendants' interpretation of W. Va. Code, 11-13-2n, deserves no
deference because the defendants allegedly changed their position from the initial proposed
regulation that would have deduction for line loss and company use to the present regulation
that prohibits such deductions. While we fail to find any administrative inconsistency in this
case, we do acknowledge that consistency of the defendants' position is one of the relevant factors to be considered.See footnote 24 As noted by the Supreme Court, "'[a]n agency interpretation of
a relevant provision which conflicts with the agency's earlier interpretation is "entitled to
considerably less deference" than a consistently held agency view.'" Good Samaritan Hosp.
v. Shalala, ___ U.S. ___, ___, 113 S. Ct. 2151, 2161, 124 L. Ed. 2d 368, 383 (1993).
(Citations omitted). On the other hand, an agency is permitted to change its position,
especially if an earlier interpretation is based on poor judgement or some mistake of law.
See generally, Good Samaritan Hosp. v. Shalala, supra. To be specific, the Tax
Commissioner is not irrevocably bound to his own precedents, so long as he gives a reasoned explanation for the departure. See, e.g., Rainbow Broadcasting Co. v. F.C.C., 949 F.2d 405,
408-09 (D.C. Cir. 1991) (emphasizing "wide latitude" afforded agencies to change their
policy through rulemaking).
The plaintiffs do not allege here that the Tax Commissioner's regulation was
arbitrary and capricious on grounds that the purported departure from precedent was
inadequately explained. It is apparent from the record that the defendants' radical regulation
change did not occur simply based upon impulse. Hearings were held and those opposing
the regulation change were permitted the opportunity to respond. Deference to the
defendants' interpretation "is especially appropriate where the rule was adopted only after
all interest [sic] persons were given notice and opportunity to comment[.]" Virginia
Agricultural Growers Ass'n, Inc. v. Donovan, 579 F. Supp 768, 773 (W.D. Va. 1984), aff'd
sub nom. Virginia Agric. Growers Ass'n v. U.S. Dept. of Labor, 756 F.2d 1025 (4th Cir.
1985). See also Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 355-56, 109
S. Ct. 1835, 1848-49, 104 L. Ed. 2d 351, 373-74 (1989) (agency amendment to its earlier
interpretation came after the prior regulation was subjected to considerable "criticism" and
thus was entitled to substantial deference). We believe this flexibility is necessary to allow
the Tax Commissioner to respond to rapidly changing "[t]echnological, commercial, and
societal aspects of the . . . industry[,]" as well as new information and ideas, as the Tax
Commissioner fulfills his delegated duties. Rainbow Broadcasting, 949 F.2d at 409. As a
matter of law and policy, this is a paradigm example of a complex economic and taxation inquiry that our Legislature has wisely left to resolution by the State's taxing authority
pursuant to its statutory mandate.
The evolution of this statute and regulation in our judgment, along with other
rules of statutory construction, rebuts the plaintiffs' claim that 110 W. Va. C.S.R. 13,
§1 A. 2.11 exceeded legislative authority.See footnote 25 As noted previously, "there is a presumption that
the legislature, when it enacts legislation, is familiar with its prior enactments." Cary v. Riss,
189 W. Va. 608, 614, 433 S.E.2d 546, 552 (1993). Indeed, realistically viewed, this
extended evaluation of an admittedly complex problem ought to be perceived as a practice
to be commended. It is strange irony that the care that preceded the final adoption and
implementation of the disputed regulation is today labeled as indecisiveness and
inconsistency, and that this supposed indecisiveness and inconsistency should be
bootstrapped into reasons to deny the Tax Commissioner's interpretation its due deference. This we refuse to do. The disputed regulation represents a particularly conscientious and
reasonable product of the Tax Commissioner's and the Legislature's deliberations, and,
therefore, merits this Court's "great deference."See footnote 26 Once the Legislature supports or at least
acquiesces in an agency's interpretation of a statute, we are reluctant to interfere if no
fundamental rights are abridged.See footnote 27
Although, we do not suggest that the defendants' interpretation is the one that
we would have constructed, it is apparent the defendants' decision to interpret W. Va. Code,
11-13-2n, to exclude line loss and company use was a well reasoned and rational decision
that comports with the language of the statute. When a court reaches the same reading of a
statute as a practical construction given it by the enforcing agency, "that is a powerful weight
supporting such reading." BankAmerica Corp. v. United States, 462 U.S. 122, 132, 103
S. Ct. 2266, 2272, 76 L. Ed. 2d 456, 464 (1983). If the defendants' interpretation is "at least
as plausible as [the] competing ones, there is little, if any, reason not to defer to . . . [their]
construction." Good Samaritan Hosp. v. Shalala, ___ U.S. at ___, 113 S. Ct. at 2161, 124 L. Ed. 2d at 383. Through this policy of deference, the Tax Commissioner, not the courts,
retains control over which permissible reading of the statute he will adopt and enforce.
Appropriately so because it is the Tax Commissioner, not the courts, who presumably has
the technical expertise and political authority to carry out statutory mandates. See Chevron,
467 U.S. at 864-66, 104 S. Ct. at 2792-93, 81 L. Ed. 2d at 716-17. Because the Tax
Commissioner's interpretation is a reasonable one, we accept it. Justice Brennan, writing for
the Supreme Court in Ford Motor Credit Co. v. Milhollin, 444 U.S. 555, 568, 100 S. Ct. 790,
798, 63 L. Ed. 2d 22, 23 (1980), wisely stated: "[A] court that tries to chart a true course to
the Act's purpose embarks upon a voyage without a compass when it disregards the agency's
views." This, in brief, states an admonition that has guided the highest courts in this country
for many years.
It is universally recognized that taxpayers have the burden to prove the Tax
Commissioner's determination is not correct.See footnote 28 In this case, the taxpayers failed to meet that
burden. Thus, we find the circuit court did not err when it found that 110 W. Va. C.S.R. 13,
§1 A. 2.11 is a valid regulation.
B.
Equal Protection
Plaintiffs also argue that the statute, as implemented, violates equal protection
guarantees because it applies the "generation tax" to entities, like the plaintiffs, that generate
electricity for sale, while excusing manufacturers who generate electricity strictly for their
own use. These contentions need not long detain us.
The Due Process Clause of Section 10 of Article III of the West Virginia
Constitution incorporates the right to equal protection. As we stated in Syllabus Point 3 of
Robertson v. Goldman, 179 W. Va. 453, 369 S.E.2d 888 (1988):
"The concept of equal protection of the laws is
inherent in article three, section ten of the West Virginia
Constitution, and the scope and application of this protection is
coextensive or broader than that of the fourteenth amendment to
the United States Constitution."
See also State ex rel. Harris v. Calendine, 160 W. Va. 172, 233 S.E.2d 318 (1977).
We have developed what are now familiar doctrines to implement the equal
protection command of Section 10. If the challenged classification affects the exercise of
a fundamental right or is based upon a constitutionally suspect criterion, the law will not be
sustained unless the State can prove that the classification is necessary to the accomplishment
of a compelling state interest. E.g., Lewis v. Canaan Valley Resorts, Inc., 185 W. Va. 684,
691, 408 S.E.2d 634, 641 (1991); Women's Health Center v. Panepinto, 191 W. Va. 436, 446 S.E.2d 658 (1993). See generally Robert M. Bastress, The West Virginia Constitution 88-92
(1995). The list of suspect criteria includes race, national origin, and alienage, and the
scrutiny to be applied to laws that engage in such distinctions is the most exacting. Robert
M. Bastress, supra at 88-92. Our cases have also imposed a heightened standard of review,
what we label "intermediate scrutiny," on classifications based on gender or illegitimacy.
Under that standard, the State must show that the differential treatment of a gender- or
illegitimacy-defined group is substantially related to an important governmental interest.
E.g., Israel by Israel v. W. Va. Secondary Schools Activities Comm'n, 182 W. Va. 454, 388 S.E.2d 480 (1989); Shelby J.S. v. George L.H., 181 W. Va. 154, 381 S.E.2d 269 (1989). As
a practical matter, this intermediate standard operates much more closely to the compelling
interest end of the analytical spectrum than to the third standard of review, that which applies
to all classifications not affecting a fundamental right or some suspect or quasi-suspect
criterion. Under that latter standard, a governmental classification will be sustained so long
as it "is rationally related to a legitimate state interest." City of Cleburne v. Cleburne Living
Center, Inc., 473 U.S. 432, 440, 105 S. Ct. 3249, 3254, 87 L. Ed. 2d 313, 320 (1985); Donley v. Bracken, 192 W. Va. 383, 389, 452 S.E.2d 699, 705 (1994); Lewis, supra. The
presumption of validity that attends the use of the "rational relationship" rule applies with
special force to social and economic enactments. E.g., Syl. pt. 1, Wetzel County Solid Waste
Authority v. West Virginia Division of Natural Resources, ___ W. Va. ___, 462 S.E.2d 349
(1995); Syl. pt. 4, Lewis, supra, citing; Syl. pt. 4, Gibson v. West Va. Dept. of Highways,
185 W. Va. 214, 406 S.E.2d 440 (1991); Syl. pt. 4, Hartsock-Flesher Candy Co. v. Wheeling
Wholesale Grocery Co., 174 W. Va. 538, 328 S.E.2d 144 (1984).
Because the statute and its implementing regulation implicate no suspect or
quasi-suspect class and burden no fundamental right, the "rational relationship" test is the
appropriate standard by which the constitutionality of W. Va. Code, 11-13-2n, and 110 W.
Va. C.S.R. 13, §1 A. 2.11 should be judged. See Whitlow v. Bd. of Educ. of Kanawha
County., 190 W. Va. 223, 438 S.E.2d 15 (1993); O'Neil v. City of Parkersburg, 160 W. Va.
694, 237 S.E.2d 504 (1977). Under this highly deferential standard, social or economic
legislation must be affirmed "if there is any reasonably conceivable state of facts that could
provide a rational basis for the classification." Federal Communications Comm'n v. Beach
Communication, Inc., ___ U.S. ___, ___, 113 S. Ct. 2096, 2101, 124 L. Ed. 2d 211, 212
(1993); Syl. pt. 1, in part, State ex rel. Haden v. Calco Awning & Window Corp., 153
W. Va. 524, 170 S.E.2d 362 (1969) ("every reasonable construction of the statute must be
resorted to by a court in order to sustain constitutionality").
In applying that analysis to this case, we think it is important to understand
exactly how the statute and regulation operate. As explained by the defendants:
"West Virginia Code § 11-13-2n imposes a tax on
every person generating or producing electricity in West
Virginia 'for sale, profit or commercial use.' Notably absent
from the quoted phrase is the word 'manufacturing.'
Consequently, the Tax Department does not impose the 2n
generation tax on companies which internally generate
electricity for their own manufacturing processes. Indeed, the
exemption of 'station use' from the definition of 'net generation
available for sale' is similarly intended to exclude electricity
used by electric power companies in the manufacturing of
electricity. Consequently, it is only fair to exclude from 'net
generation available for sale' electricity generated by ferro-alloy
plants and other co-generators to the extent that such electricity
is consumed in the manufacturing process. (To the extent such
co-generators produce excess electricity and inject it into the
interstate transmission network, it is taxed.)" (Emphasis in
original).
Thus, the challenged provisions impose the generation tax on all entities who
generate electricity to the extent of their "net generation." As we have noted, "net
generation" is determined by subtracting station use from the total electricity generated.
Plaintiffs' complaint appears to be that equal protection is denied because for some electrical
producers the deductible is the same as the total amount they produce. Thus, one could
argue that the deductible effectively creates a classification between companies who generate
electricity for resale and companies who generate electricity strictly for their own use at the
generation site. We see no troubling discrimination here. The Legislature has simply seen
fit to tax one activity -- generation of electricity for resale -- and to not tax another -- generation of electricity for self-use. This distinction is commonplace; the Legislature could,
for example, impose a tax (income, sales, or gross receipts) on a farmer's sale of his corn but
leave completely untaxed the corn he produced for consumption by his family and livestock.
This case is no different; there is simply no transaction that triggers the tax. What Justice
Jackson observed in 1949, albeit in a regulatory context, remains as applicable as when he
wrote it: "[T]here is a real difference between doing in self-interest and doing for hire, so
that it is one thing to . . . [forego taxing] action from those who act on their own and it is
another thing to . . . [tax] the same action to be promoted for a price." Railway Express
Agency, Inc. v. New York, 336 U.S. 106, 116, 69 S. Ct. 463, 468, 93 L. Ed. 533, 541-42
(1949) (Jackson, J., concurring) (city could allow vehicle advertising space used to promote
its owner's business but ban vehicle advertising space sold to promote another's business).
The Legislature and the Tax Commissioner may also have concluded that the return from a
tax on the electricity produced by companies that generate only enough to feed on-site
operations cannot justify the costs of collection and enforcement. The tax would not be
worth the candle, so to speak.
Moreover, this Court has sustained against an equal protection challenge a
statute that taxed public utilities for sales of natural gas at a higher rate than that imposed on
unregulated companies for identical sales. United Fuel Gas Co. v. Battle, 153 W. Va. 222,
167 S.E.2d 890, appeal dismissed and cert. denied sub nom. United Fuel Gas Co. v. Haden,
396 U.S. 116, 90 S. Ct. 398, 24 L. Ed. 2d 309 (1969). We held that "[t]he differences in the rights and duties of a public utility and a nonutility justify the separate classification in which
each is included." 153 W. Va. at 250, 167 S.E.2d at 906. That is effectively the same
classification present in this case, as plaintiffs are all public utilities engaged in the business
of selling electricity, and the class that they complain has received preferential treatment
consists (so far as we can tell from the record) entirely of nonpublic utilities. As we
previously suggested: "a person who assails any such classification has the burden of
showing that it is essentially arbitrary and unreasonable." Syl. pt. 5, United Fuel Gas Co.
v. Battle, supra. The plaintiffs have again failed to meet their burden of proof.
Plaintiffs also invoke the Equal and Uniform Clause from Section 1 of Article
X of the West Virginia Constitution, which states, "taxation shall be equal and uniform
throughout the State[.]" That provision, however, accords plaintiffs no relief. For taxes
other than those levied on property, it merely requires that the taxes not discriminate along
geographical lines (i.e., they must be uniform "throughout the State"), that taxes be equal
within each class of persons or businesses taxed, and (presumably) that there be some
reasonable basis for the Legislature's classification scheme. See In re Assessment of
Kanawha Valley Bank, 144 W. Va. 346, 109 S.E.2d 649 (1959); Appalachian Electric Power
Company v. Koontz, 138 W. Va. 84, 76 S.E.2d 863 (1953); Arslain v. Alderson, 126 W. Va.
880, 30 S.E.2d 533 (1944). We have decided above that the Legislature has a reasonable
basis for classifying as it did in § 11-13-2n. Obviously, the section creates no geographical distinctions and treats all businesses within each class the same. Therefore, we conclude that
the section is consistent with the Equal and Uniform Clause.
We must exercise considerable caution in using our equality provisions to
scrutinize underinclusive challenges to tax legislation -- those cases in which the taxpayer
objects to his tax because some other group, even if similar, has escaped the levy. Statutes
taxing economic activity (as opposed to taxing property) have historically and necessarily
drawn lines to accommodate a myriad of ancillary interests, such as the desire to encourage
(or discourage) some activity over (or in favor of) another, to balance the equities in a given
context, to allow breaks to a group less able to pay, to impose the fiscal burden on those best
able to pay, or to achieve administrative efficiencies. Courts should venture into that thicket
only with utmost trepidation and only for a very good reason. We find no reason in this case
to overcome our reluctance to second-guess a tax classification; we fail to see any invidious
or arbitrary discrimination at work in a distinction between electricity-generating companies
based on whether the electricity is sold or is retained entirely for station use. That is life in
the economic and political trenches.
III.
CONCLUSION
For the foregoing reasons, the decision of the Circuit Court of Kanawha
County is affirmed.
Affirmed.
Footnote: 1
The plaintiffs are the Appalachian Power Company, Duquesne Light Company,
Monongahela Power Company, Ohio Power Company, The Potomac Edison Company,
Virginia Electric and Power Company, and West Penn Power Company. The defendants are
the State Tax Department and the State Tax Commissioner who is currently James H. Paige
III. Footnote: 2
W. Va. Code, 11-13-2n, was amended in 1995. However, the changes do not affect
the resolution of this case. Footnote: 3
The initial regulation read, in pertinent part:
"1 A. 2.2 'Company use' means that amount of
electrical energy, excluding station use, used to construct,
maintain or operate generation, transmission, office or other
facilities of the taxpayer in West Virginia, used in the conduct
of any electric utility business in West Virginia or any electric
energy generation business in West Virginia.
* * *
"1 A. 2.11 'Kilowatt hours of net generation
available for sale that was generated or produced in this State'
means net kilowatt hours generated or produced in West
Virginia less both company use and line loss as herein defined.
"1 A. 2.12 'Line loss' means the amount of loss of
electrical energy occurring in or attributable to transmission
lines, facilities or apparatus in West Virginia. For purposes of
these regulations, line loss is line loss at transmission levels at
which power is exported out of the State of West Virginia. Line
loss shall in no case exceed 1.5% of net kilowatt hours
generated or produced in West Virginia."Footnote: 4
"Company use" and "station use" were defined as follows:
"1 A. 2.2 'Company use' means that amount of
electrical energy, excluding station use and line loss, used to
construct, maintain or operate generation, transmission, office
or other facilities of the taxpayer in West Virginia, used in the
conduct of any electric utility business in West Virginia or any
electric energy generation business in West Virginia.
* * *
"1 A. 2.22 'Station use' or 'plant use' means that
amount of electric energy used by a generating station in the
production of electricity and general operation of the generating
station. The term 'station use' or 'plant use' includes the energy
used for pumping water for purposes of providing stored energy
at a pumped storage hydroelectric plant. 'Station use' or 'plant
use' does not include company use or line loss."Footnote: 5
Generally, this Court reviews findings of fact for clear error and conclusions of law
de novo. However, ostensible "findings of fact," which entail the application of law or
constitute legal judgments which transcend ordinary factual determinations, must be
reviewed de novo. Bose Corp. v. Consumers Union of U.S., Inc., 466 U.S. 485, 500-01, 104 S. Ct. 1949, 1959, 80 L. Ed. 2d 502, 516-17 (1984); Powell v. Texas, 392 U.S. 514, 521-22,
88 S. Ct. 2145, 2148-49, 20 L. Ed. 2d 1254, 1261-62 (1968); State v. Farley, 192 W. Va. 247,
452 S.E.2d 50 (1994). Moreover, mixed questions of law and fact, like pure questions of
law, or those involving statutory interpretations, are most often reviewed de novo. Most
significantly, the sufficiency of the information presented at trial to support a finding that a
constitutional predicate has been satisfied presents a question of law. Harte-Hanks
Communications, Inc. v. Connaughton, 491 U.S. 657, 685-89, 109 S. Ct. 2678, 2694-96, 105 L. Ed. 2d 562, 587-90 (1989). Because most, if not all of the lower court's findings in the
instant case constitute ultimate facts and interrelated applications of the law, economic and
taxation judgments, mixed questions of law and fact, and/or findings designed to support
"constitutional facts" (to-wit: the existence of a class or a fundamental right which has been
invaded), they are subject to plenary review. Footnote: 6
Chevron, of course, was a watershed decision in the area of judicial deference to
regulatory agencies. Significantly, however, Chevron involved a properly promulgated
"federal" legislative rule. We emphasize "federal" because there is a substantial difference
between legislative rules in West Virginia and those on the federal level. Federal legislative
rules do not require a specific Act of Congress authorizing them. Under the Federal
Administrative Procedures Act, rules may be either legislative or nonlegislative. A
legislative rule must be promulgated according to the notice and comment procedures of Title
5 U.S.C. § 553. A legislative rule that is not promulgated in accordance with these
requirement is not entitled to the force of law. See, e.g., Batterton v. Francis, 432 U.S. 416,
425-26 n.9, 97 S. Ct. 2399, 2405-06 n.9, 53 L. Ed. 2d 448, 456-57 n.9 (1977); Chrysler Corp.
v. Brown, 441 U.S. 281, 302-03, 99 S. Ct. 1705, 1717-18, 60 L. Ed. 2d 208, 225-26 (1979).
A federal agency may adopt and promulgate legislative rules as a lawful delegation of
legislative authority. Being concerned with legislative rules only, Chevron simply did not
deal with the level of consideration a court should give to an interpretive rule.
Indeed, in the years following Chevron, the Supreme Court reaffirmed its
classic standard in Skidmore v. Swift & Co., 323 U.S. 134, 140, 65 S. Ct. 161, 164, 89 L. Ed. 124, 129 (1944) (interpretive rules are not binding on a reviewing court but serve only as a
source of guidance). In Martin v. Occupational Safety and Health Review Commission, 499 U.S. 144, 157, 111 S. Ct. 1171, 1179, 113 L. Ed. 2d 117, 132 (1991), the Supreme Court,
citing Skidmore, opined that interpretive rules are not "entitled to the same deference as
norms that derive from the exercise of the Secretary's delegated lawmaking powers[.]" This
approach was reaffirmed three decades after Skidmore in General Electric Co. v. Gilbert, 429 U.S. 125, 141-42, 97 S. Ct. 401, 410-11, 50 L. Ed. 2d 343, 357-58 (1976), superseded by
statute/rule as stated in Shaw v. Delta Airlines, Inc., 463 U.S. 85, 103 S. Ct. 2890, 77 L. Ed. 2d 490 (1983). where the Supreme Court analyzed an EEOC guideline as an
interpretive rule under the Skidmore doctrine. It is therefore manifest that Skidmore and
Gilbert survived Chevron.Footnote: 7
Under Gilbert, an interpretive rule is entitled to some deference, but it is not to be
given the full Chevron deference that applies to "legislative" rules. We are obligated to give
appropriate consideration to all agency interpretations (which many of our cases have
referred to as deference). Then we must decide how much weight the interpretation should
receive. To say that we give it "no deference" implies that we do not even consider the
interpretation, which is not the case. We refuse to become a "rubber stamp" for an agency's
action. But, it is more accurate to say that interpretive rules are not to be given controlling
weight than it is to say that they would be given no deference. There is, indeed, a great
danger in giving Chevron deference (and often legislative effect) to rules promulgated
without the benefit of legislative oversight.Footnote: 8
We merely mean that an agency is free to revise and adopt interpretive rules
prospectively. Of course, an agency must follow and apply its rules and regulations in
existence at the time of agency action. W. Va. Code, 29A-1-2(c) states that "an interpretive
rule is admissible for the purpose of showing that the prior conduct of a person was based
on good faith reliance on such rule. The admission of such rule in no way affects any
legislative or judicial determination regarding the prospective effect of such rule."Footnote: 9
In Equal Employment Opportunity Commission v. Arabian American Oil Co., 499 U.S. 244, 259-60, 111 S. Ct. 1227, 1236-37, 113 L. Ed. 2d 274, 289-90 (1991), superseded
by statute as stated in Landgraf v. USI Film Products, ___ U.S. ___, 114 S. Ct. 1483, 128 L. Ed. 2d 229 (1994), Justice Scalia concurred, opining that the interpretive rule was entitled
to Chevron deference and that Gilbert was "an anachronism[.]" It is clear, however, that the
majority held Chevron was not applicable.Footnote: 10
After reviewing the omnibus bill passing 110 W. Va. C.S.R. 13, §1 A. 2.11, it is clear
this is the form of omnibus bill that we were concerned about in Kincaid v. Mangum, supra.
The bill in question groups together many different rules without any rational basis for the
grouping. Additionally, the bill does not include the full text of any of the rules it covers.
In fact, 110 W. Va. C.S.R. 13, §1 A. 2.11 is never specifically mentioned in the bill. The
omnibus bill contained a general provision authorizing the promulgation of all the relevant
rules subject only to the changes mentioned in the bill. Thus, if the Legislature made no
changes to 110 W. Va. C.S.R. 13, §1a2.11, it is reasonable to believe that the Legislature did
not specifically register its approval of this particular rule and instead relied on the general
provisions permitting rule promulgation. Footnote: 11
Under W. Va. Code, 29A-3-11(b) (1995), this committee is charged, among other
things, with the responsibility of reviewing the following factors:
"(1) Whether the agency has exceeded the scope
of its statutory authority in approving the proposed legislative
rule;
"(2) Whether the proposed legislative rule is in
conformity with the legislative intent of the statute which the
rule is intended to implement, extend, apply, interpret or make
specific;
"(3) Whether the proposed legislative rule
conflicts with any other provision of this code or with any other
rule adopted by the same or a different agency;
"(4) Whether the proposed legislative rule is
necessary to fully accomplish the objectives of the statute under
which the proposed rule was for promulgation;
"(5) Whether the proposed legislative rule is
reasonable, especially as it affects the convenience of the
general public or of persons particularly affected by it;
"(6) Whether the proposed legislative rule could
be made less complex or more readily understandable by the
general public; and
"(7) Whether the proposed legislative rule was
proposed for promulgation in compliance with the requirements
of this article and with any requirements imposed by any other
provision of this code."Footnote: 12
This Court has spoken to the legislative review of administrative rules or regulations
on several occasions, while the process of legislative review has itself matured and adjusted
considerably since its inception. See State ex rel. Meadows v. Hechler, ___ W. Va. ___, 462 S.E.2d 586, 590-93 (1995) (discusses the history of legislative rulemaking review). We
recognize that such is a dynamic, ongoing development. Accordingly, it should not be
presumed that all we have said prior to today's ruling precisely controls or limits the ongoing
development by the Legislature of its suitable role in the review and promulgation of
administrative rules or regulations. Footnote: 13
We also would go to step two of Chevron in the unlikely event that we found that
a legislative rule, valid in all respects, was itself ambiguous as to its intent or meaning. Footnote: 14
Normally, legislative history in West Virginia is difficult to discover and this Court
has not engaged in extensive analysis as to its utility in statutory construction. This case is
quite different, and preenactment and post-enactment legislative history and rule making
history could provide significant insight as to legislative intent. For that reason, we discuss
the role of legislative history within the context of the Chevron doctrine. Footnote: 15
In Kofa v. U.S. Immigration & Naturalization Service, 60 F.3d 1084, 1088 (4th Cir.
1995), the Fourth Circuit stated:
"However, the first place where we must look to
see if . . . [the legislature] has spoken to the issue with which we
are concerned and whether . . . [legislative] intent in that regard
is clear is on the face of the statute. Statutory construction must
begin with the language of the statute. . . . To do otherwise
would assume that . . . [the legislature] does not express its
intent in the words of statutes, but only by way of legislative
history, an idea that hopefully all will find unpalatable."
(Citations omitted). Footnote: 16
We do not believe that post-enactment legislative history is entitled to substantial
consideration in construing a statute.
"The use of legislative history in this fashion, and especially
postenactment legislative history, is a process that has been
soundly criticized. . . . Continental Can [Co., Inc.] v. Chicago
Truck Drivers, et al., 916 F.2d . . . [1154, 1157-58 (7th Cir.
1990)] (stating that postenactment statements 'do not count'
because the term '"subsequent legislative history" [is] an
oxymoron.' (citations omitted); 2B Norman J. Singer,
Sutherland Statutory Construction §49.06, at 59 (5th ed. 1992)
('Little weight is given to postenactment statements by members
of . . . [the legislature]')." Kofa v. U.S. Immigration &
Naturalization Service, 60 F.3d at 1089.Footnote: 17
As stated in Snuffer, 193 W. Va. at ___, 456 S.E.2d at 498, there are situations that the
Chevron deference need not be given:
"The policy underlying our grant of special deference to agency
decisions and similar official agency pronouncements does not
extend to every agency action. For example, it would not
extend to ad hoc representations on behalf of an agency, such as
litigation arguments. Bowen v. Georgetown Univ. Hosp., 488 U.S. 204, 213, 109 S. Ct. 468, 474, 102 L. Ed. 2d 493, 503
(1988) (little weight should be given to expedient litigation
position of an agency). Similarly, an agency's interpretation of
a statute is not entitled to deference when it goes beyond the
meaning the statute can bear. Pittson Coal Group v. Sebben,
488 U.S. 105, 113, 109 S. Ct. 414, 420, 102 L. Ed. 2d 408, 419-
20 (1988)." (Cleckley, J., concurring).
In addition, there are other circumstances that an agency's rule is not entitled to deference.
Once this Court determines a statute's clear meaning, we will adhere to that determination
under the doctrine of stare decisis. An agency's later determination of the statute is not
entitled to deference but will be judged against that prior judicial determination of the
statute's meaning. See Maislin Industries, U.S., Inc. v. Primary Steel, Inc., 497 U.S. 116,
131, 110 S. Ct. 2759, 2769, 111 L. Ed. 2d 94, 111 (1990), superseded by statute as stated in
Jones Truck Lines, Inc. v. AFCO Steel, Inc., 849 F. Supp. 1296 (1994). Similarly, when the
agency's interpretation goes beyond that scope of whatever ambiguity the statute contains,
no deference is due. See City of Chicago v. Environmental Defense Fund, ___ U.S. ___,
___, 114 S. Ct. 1588, 1594, 128 L. Ed. 2d 302, 312 (1994). Footnote: 18
Apart from Chevron, W. Va. Code, 29A-4-2 expressly provides that an interested
party may seek judicial review of any rule on the grounds that "the rule violates
constitutional provisions or exceeds the statutory authority or jurisdiction of the agency or
was adopted without compliance with statutory rule-making procedures or is arbitrary or
capricious ..." We interpret this section to authorize meaning judicial review on any of these
grounds mentioned notwithstanding its authorization by legislative enactment. Footnote: 19
Thus, our commitment to agency discretion does not authorize the agency to exceed
its authority. Harmon v. Brucker, 355 U.S. 579, 582, 78 S. Ct. 433, 435, 2 L. Ed. 2d 503, 506
(1958). See Rowe v. West Va. Dept. of Corrections, 170 W. Va. 230, 292 S.E.2d 650
(1982); Anderson & Anderson Contractors, Inc. v. Latimer, 162
W. Va. 803, 807-08, 257 S.E.2d 878, 881 (1979) ("[a]lthough an agency may have power
to promulgate rules and regulations, the rules and regulations must be
reasonable and conform to the laws enacted by the Legislature"). "'The judiciary is
the final authority on issues of statutory construction and . . . [we are obliged to] reject
administrative constructions which are contrary to clear . . . [legislative] intent.'" INS. v.
Cardoza-Fonseca, 480 U.S. at 447-48, 107 S. Ct. at 1221, 94 L. Ed. 2d at 457-58, quoting
Chevron, 467 U.S. at 843 n.9, 104 S. Ct. at 2781 n.9, 81 L. Ed. 2d at 703 n.9. This Court has
recognized that "an agency's determination of matters within its area of expertise is entitled
to substantial weight . . . [but that] does not mean a court should shirk its obligation to make
a searching and careful inquiry into the facts[.]" Princeton Community Hospital v. State
Health Planning, 174 W. Va. 558, 564, 328 S.E.2d 164, 171 (1985).Footnote: 20
W. Va. Code, 11-13-2n, reads, in pertinent part:
"(a) Rate of tax. -- Upon every person engaging or
continuing within this state in the business of generating or
producing electricity for sale, profit or commercial use, either
directly or indirectly through the activity of others, in whole or
in part, or in the business of selling electricity to consumers, or
in both businesses, the tax imposed by section two[§ 11-13-2]
of this article shall be equal to:
"(1) Twenty-six hundredths of one cent times the
kilowatt hours of net generation available for sale that was
generated or produced in this state by the taxpayer during the
taxable year, except that this rate shall be five hundredths of one
cent times the kilowatt hours of net generation available for sale
that was generated or produced in this state by the taxpayer and
sold to a plant location of a customer engaged in manufacturing
activity if the contract demands at such plant location exceeds
two hundred thousand kilowatts per hour per year or if the usage
at such plant location exceeds two hundred thousand kilowatts
per hour in a year: Provided, That in order to encourage the
development of industry to improve the environment of this
state, the tax imposed by this section on any person generating
or producing electric power and an alternative form of energy at
a facility located within this state substantially from gob or other
mine refuse shall be equal to five hundredths of one cent times
the kilowatt hours of net generation or production available for
sale. The measure of tax under this paragraph shall be equal to
the total kilowatt hours of net generation available for sale that
was generated or produced in this state by the taxpayer during
the taxable year, regardless of the place of sale or use, or the
fact that transmission may be made to points outside this state."Footnote: 21
There being no real dispute concerning the defendants' authority to promulgate rules
in this situation and considering the fact that the plaintiffs have shown no evidence of bias,
prejudice, or extreme outside influences, see generally Charles H. Koch, Jr., Administrative
Law and Practice §§ 4.71-4.77 at 273-88 (1985) (discussing the importance of having
unbiased administrative rulemaking process), the only other issue in this section is to
determine if 110 W. Va. C.S.R. 13, §1 A. 2.11 is a reasonable interpretation of W. Va. Code,
11-13-2n.Footnote: 22
Of course, we would find the argument of the plaintiffs more persuasive if the
regulation in question excluded all losses including station loss. The fact that some
deduction is permitted goes a long way, in our judgment, of justifying the Tax
Commissioner's position. Indeed, the only way that we with our limited powers of review,
could disagree with the Commissioner is if we found some specific language in the statute
that clearly indicated that more than station loss was required to be deducted. We are unable
to find such language. This is a classic example of a taxpayer arguing to the wrong branch
of government. The appropriate route for the relief requested in this case is in the West
Virginia Legislature. Footnote: 23
The basic approach taken by courts to administrative interpretations is that set forth
by Chief Justice Warren in Udall v. Tallman, 380 U.S. 1, 16, 85 S. Ct. 792, 801, 13 L. Ed. 2d 616, 625(1965):
"When faced with a problem of statutory
construction, this Court shows great deference to the
nterpretation given the statute by the officers or agency charged
with its administration. 'To sustain the Commission's
application of this statutory term, we need not find that its
construction is the only reasonable one, or even that it is the
result we would have reached had the question arisen in the first
instance in judicial proceedings.' Unemployment Comm'n [of
Alaska] v. Aragon, 329 U.S. 143, 153[, 67 S. Ct. 245, 250, 91 L. Ed. 136, 145 (1946)]. . . . 'Particularly is this respect due
when the administrative practice at stake "involves a
contemporaneous construction of a statute by the men [and
women] charged with the responsibility of setting its machinery
in motion, of making the parts work efficiently and smoothly
while they are yet untried and new."'" (Citations omitted).Footnote: 24
Inconsistency is only one of many circumstances that this Court should consider in
determining deference. The factors most often recognized by courts as to whether to defer
to administrative interpretations were set out by Colin S. Diver in Statutory Interpretation in
the Administrative State, 133 U. Pa. L. Rev. 549, 562 n. 95 (1985). He lists them as
"(1) whether the agency construction was rendered
contemporaneously with the statute's passage, . . . (2) whether
the agency's construction is of longstanding application, . . . (3)
whether the agency has maintained its position consistently
(even if infrequently), . . . (4) whether the public has relied on
the agency's interpretation, . . . (5) whether the interpretation
involves a matter of 'public controversy,' . . . (6) whether the
interpretation is based on 'expertise' or involves a 'technical and
complex' subject, . . . (7)whether the agency has rulemaking
authority, . . . (8) whether agency action is necessary to set the
statute in motion, . . . (9) whether . . . [the Legislature] was
aware of the agency['s] interpretation and failed to repudiate it,
. . . and (10) whether the agency has expressly addressed the
application of the statute to its proposed action[.]" (Citations
omitted).
Furthermore, it is not clear from the record that the change the plaintiffs identify is in fact
an inconsistency as opposed to a modification of the rule in the rulemaking process. Footnote: 25
Crucial to our decision today is our awareness that the Legislature expressly
approved 110 W. Va. C.S.R. 13, §1 A. 2.11 as a reasonable interpretation of W. Va. Code, 11-
13-2n. Here, we refer to more than post-enactment legislative history but to specific and
concrete legislation that gave the Tax Commissioner's interpretation a stamp of approval.
If any doubt existed as to the meaning of the statute and what the Legislature intended, that
doubt was removed by the adoption of a subsequently enacted omnibus bill. As part of the
omnibus bill that was passed in 1990, the Legislature gave its endorsement to the Tax
Commissioner's interpretation. The relevant provisions of W. Va. Code, 11-13-2n, and 110
W. Va. C.S.R. 13, §1 A. 2.11 went through four legislative stages: (1) the initial enactment
providing for taxation on "net generation available for sale"; (2) the adoption of 110 W. Va.
C.S.R. 13, §1 A. 2.11; (3) legislative hearings as to the validity of 110 W. Va. C.S.R. 13,
§1 A. 2.11; and (4) the approval of 110 W. Va. C.S.R. 13, §1 A. 2.11 by the Legislature in an
omnibus bill.Footnote: 26
We garner additional support for this deferential viewpoint after reviewing the
minutes from the November 14, 1989, meeting of the Legislative Rulemaking Committee.
The minutes indicate that during the meeting the proposed rule that is in question was
reviewed and representatives of the plaintiffs and the Tax Commissioner were permitted to
address the committee, answer questions, and distribute information to the committee. A
member of the committee even specifically "moved that the proposed rule be amended to
allow for line loss and company use." However, this motion failed. It is clear that the
committee had the opportunity to discuss and review relevant information concerning this
rule.
We cannot ignore the argument that the Legislature not only expressly
approved the regulation, but did not change the wording of the statute, despite the fact the
regulation in question had been in existence and contested since 1989. "[A] refusal by . . .
[the Legislature] to overrule an agency's construction of legislation is at least some evidence
of the reasonableness of that construction[.]" United States v. Riverside Bayview Homes,
Inc., 474 U.S. 121, 137, 106 S. Ct. 455, 464, 88 L. Ed. 2d 419, 433 (1985).Footnote: 27
In their brief, the defendants note that the phrase "net generation available for sale,"
using the same definition currently contested, has also been used in a new statute.
Accordingly, the defendants argue that, because the plaintiffs have not
challenged the new tax, "the instant case [is] moot, as the new statute has a legislative history
incorporating past-practice, and this lawsuit, seeking only prospective relief, does not
challenge the existing tax or its definitions." As we have suggested in note 15, supra, post-
enactment discussions of statutes can be informative, but, as legislative history, they are
deserving of little if any weight. On the other hand, while post-enactment statutes revisiting
Code sections and maintaining the same language are deserving of some consideration, they
too are not necessarily dispositive. The amount of weight given will depend, among other
things, upon the use of the contested language in the newer statute. Therefore, a case-by-
case analysis is necessary.Footnote: 28
See Welch v. Helvering, 290 U.S. 111, 54 S. Ct. 8, 78 L. Ed. 212 (1933).
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