Palmer man's road service area lawsuit nixed

ANCHORAGE —The Alaska Supreme Court has ruled against a Palmer man in a court opinion issued last week.

Ray DeVilbiss had sued the Mat-Su borough in 2012 claiming an exemption from the Lazy Mountain Road Service Area. Three parcels of his land are located along Clark-Wolverine Road, a state-maintained roadway. The properties were annexed into the RSA in 1981.

DeVilbiss claimed that because he made no use of local roads, and instead used state-maintained roadways, his properties should be excluded from the RSA and its tax bill.

Superior Court Judge Eric Smith rejected those claims in a summary judgment issued September 9, 2013, and subsequently awarded the Mat-Su Borough $2,295 in attorneys fees, or about 20 percent of the total fees incurred as result of the lawsuit. DeVilbiss appealed.

Ray DeVilbiss is the brother of sitting Mat-Su Borough mayor Larry DeVilbiss.

The court ultimately conducted a de novo review of the lawsuit, essentially reviewing the case from scratch, rather than a simple examination of the procedure.

Writing for the justices, Chief Justice Dana Fabe rejected the argument that state law required DeVilbiss’ properties be exempted from the service area.

Alaska law “grants boroughs and unified municipalities the ability to establish, operate, alter, and abolish road service areas,” she wrote.

DeVilbiss’ properties do not meet the criteria for exemption from the RSA, empowering the borough to “exercise its judgment” to exclude DeVilbiss’ property, which it did in the original hearing in 2012, when DeVilbiss first asked the borough assembly to exclude him.

DeVilbiss had also argued that the RSA fees constituted an illegal special assessment, not a tax. The court also rejected that claim.

“Contrary to DeVilbiss’ argument, whether a particular levy is a tax or an assessment does not depend on the use to which the resulting funds are put, and we will not interfere with the boroughs choice to use a tax, charge, or assessment to finance its activities,” Fabe wrote.

DeVilbiss had argued that the borough’s second-class status had mandated two votes: one to establish RSA borders and a second one to enable the RSA to tax. The justices reaffirmed previous rulings to the contrary.

DeVilibiss had finally argued that because he received no specific benefit from the RSA, the tax was invalid. Fabe cited two US Supreme Court decisions, a 1931 decision that found that ad valorem taxes — taxes lobbied as a proportion of the value of a property, like property taxes — don’t depend on special benefit for validity. A 1937 ruling further held that taxes are not dependent on benefits, but a distribution of government costs.

“Effectively every state high court to have considered the same question with regard to its state constitution as reached the same conclusion as the Supreme Court,” Fabe wrote.

Essentially, Alaska taxpayers don’t have to benefit from a tax in order to pay it, the court ruled.

DeVilbiss had asked for attorney fees to be excluded because the case involved questions of constitutionality. However, the court ruled against him on that front as well. DeVilbiss had sought not only to have future taxes removed, but also for relieve for the 20 years of taxes previously collected. DeVilbiss’ tax bill at the time of the lawsuit amounted to $1,500 per year.

“Under any standard of review, DeVilbiss had sufficient economic incentive to bring his claim against the Borough regardless of the constitutional nature of that claim,” Fabe wrote.

Borough property records show DeVilbiss faced a 13.951 cumulative mill rate in 2015, and paid $2,162.41 in property taxes. Of that amount, 2.51 mills, or $389.05, was contributed to Lazy Mountain Road Service Area.

Ralph DeVilbiss — father of Larry, Ray, and Susan, and later adopted children Brian and Billy, purchased the property from Christian Ministries in 1978 for $100,000, according to Department of Natural Resources documents and the Frontiersman archives.

Ray DeVilbiss declined immediate comment, saying he was busy and hadn’t had time to read the decision.

Contact Reporter Brian O’Connor at 352-2269, brian.oconnor@frontiersman.com, or on Twitter @reporterbriano.