October 27, 1983

Mr. Warren R. Neufeld 
Secretary 
Department of Water and Natural Resources 
Joe Foss Building 
Pierre, South Dakota 57501

Official Opinion No. 83-36

Conservancy Subdistrict Withdrawals

Dear Secretary Neufeld:

You have requested an official opinion from this office in regard to the following factual situation:

FACTS: 

Lawrence and Meade Counties voted on August 30 to withdraw from the Black Hills Conservancy Subdistrict to form two separate and distinct subdistricts with boundaries following county lines.  Each of these subdistricts has incurred costs during the withdrawal election process.  They will also incur costs for their administrative and operation costs from August 30, 1983, to December 31, 1984.  Because of the timing of the withdrawal, each subdistrict will be unable to submit a 1984 tax levy resolution. 

In 1982 the Black Hills Conservancy Subdistrict levied a tax for administrative and project development costs, with said tax to be collected in 1983.  In addition to administrative and project development costs, it has been the practice of the Black Hills Conservancy Subdistrict to collect tax revenues above anticipated expenditures in order to maintain a cash reserve. 

For their initial year of operation, each subdistrict can use the state 'subdistrict revolving fund' for operating capital until a tax can be levied in 1985 under normal budgeting procedures.  A revolving fund of $50,000 was established pursuant to SDCL 46-18-46 'for the purpose of aiding, assisting and cooperating with conservancy subdistricts of the state in financing administrative and planning costs incurred or to be incurred by the  Conservancy Subdistrict Board of Directors.'

Based on the above facts, you have asked the following questions:

QUESTIONS: 

1.  Are Lawrence and Meade Counties obligated to continue collecting taxes for the remainder of the current calendar year and crediting such taxes to the Black Hills Conservancy Subdistrict pursuant to its 1982 tax resolution and pursuant to SDCL 46-18-45? 

2.  Are the Lawrence and Meade County Subdistricts entitled to a share of such tax revenues or of the cash reserves and assets of the Black Hills Subdistrict?

IN RE QUESTION NO. 1:

In answering your first question, I will make the following assumptions:  That in August of 1982 the Black Hills Conservancy Subdistrict submitted its budget for fiscal year 1983 to the Board of Water and Natural Resources for approval pursuant to ARSD 74:20:02:03; that the budget was approved and that pursuant to SDCL 46-18-42, the Black Hills Conservancy Subdistrict levied a tax in the form of a resolution by the board of directors; that the levy and  budget were then sent to the county auditors of Pennington, Custer, Lawrence and Meade Counties pursuant to SDCL 46-18-43; that the respective auditors extended the levy for the tax year in the same manner other taxes are extended, pursuant to SDCL 46-18-44; and that the levy was extended against taxable property in those counties prior to January 1, 1983.

Based upon those assumptions, the taxes resulting from the levy extended by the auditors against all taxable property in the subdistrict, including all taxable property in Lawrence County and Meade County became due on January 1, 1983.  Those taxes also became a lien upon the real property against which the levy was extended on that date.  See SDCL 10-19-1;  SDCL 10-21-4.  Those taxes are thereafter to be collected by the county auditors the same as other taxes, and the auditors are to pay to the subdistrict monthly all taxes collected during the preceding month.  SDCL 46-18-45.

The subdistrict had the authority and jurisdiction to levy the tax at the time the levy was made.  The tax became due and a lien on taxable property in Lawrence and Meade Counties January 1, 1983.  It is my opinion that the subsequent withdrawal of those two counties from the subdistrict pursuant to SDCL 46-18-11 does not affect the validity of that tax.  I have discovered no statutory authority which would allow any type of abatement, refund, or apportionment of those taxes.  See A.G.R. 1917-18, page 58.  Therefore, in my opinion, Lawrence and Meade Counties are obligated to continue collecting taxes  for the remainder of the current calendar year and crediting such taxes to the Black Hills Conservancy Subdistrict.  I am of the opinion that the answer to question 1 is YES.

IN RE QUESTION NO. 2:

I am further of the opinion that the answer to your second question is NO.  There is simply no statutory authority that would permit the two newly formed subdistricts to share in the tax revenues, cash reserves, or assets of the subdistrict from which they have withdrawn.  The Legislature made clear that there might be a continuing obligation to the subdistrict from which the area was withdrawn.  SDCL 46-18-11.1.  However, the statutes are silent concerning any apportionment of tax revenues, cash reserves, or assets.  The Legislature certainly knows how to address similar matters in comparable situations.  See, e.g., SDCL 13-6-77; SDCL 13-6-77; SDCL 13-6-82; SDCL 13‑6‑88; SDCL 7-3-7; and SDCL 8-1-17.

Therefore absent statutory authorization of the apportionment of assets upon the withdrawal of an area from a conservancy subdistrict, it is my opinion that no authority exists which would entitle the Lawrence County Subdistrict and the Meade County Subdistrict to any share of the tax revenues, cash reserves or assets of the Black Hills Conservancy Subdistrict.

Respectfully submitted,

Mark V. Meierhenry
Attorney General