Appeals, Nos. 201, 206 and 207, March T., 1959, from decree of Court of Common Pleas of Beaver County, Sept. T., 1957, No. 3, in equity, in case of St. Joseph Lead Company et al. v. Township of Potter. Decree affirmed; reargument refused February 12, 1960. Equity. Before SOHN, J. Adjudication filed enjoining defendant from issuing general obligation bonds and from levying certain taxes; plaintiffs' and defendant's exceptions dismissed and final decree entered. Plaintiffs and defendant, respectively, appealed.
Harold F. Reed, jr., with him Leonard L. Ewing, and Reed, Ewing, Orr & Reed, for plaintiffs.
Gustav W. Wilde, with him J. Frank Kelker, and Burgwin, Ruffin, Perry & Pohl, for defendant.
Before Jones, C.j., Bell, Musmanno, Jones, Cohen, Bok and Mcbride, JJ.
OPINION BY MR. JUSTICE COHEN
These are separate appeals by the defendant Township of Potter and by the plaintiffs, St. Joseph Lead Company and Koppers Company, Inc., from the final decree of the Court of Common Pleas of Beaver County, Pennsylvania. Under the decree, the supervisors of defendant township were enjoined from issuing general obligation bonds in the sum of $300,000 or any part thereof, for the purpose of creating a revolving fund for the construction of a contemplated water works system, and were further enjoined from levying an ad valorem tax on plaintiffs' property for the purpose of maintaining said revolving fund or paying the contemplated general obligation bonds.
The facts pertinent to the determination of this case are few. The residents and supervisors of defendant township, a township of the second class of Beaver County, desiring to construct and maintain a permanent water supply system, have attempted to do so by means of issuing general obligation bonds and by levying an ad valorem tax in order to retire said bonds. On March 21, 1957, the supervisors enacted a desire ordinance submitting to the electorate the question whether to increase the township's indebtedness from zero to $300,000. The stated purpose was to provide funds for the creation of a revolving fund to be used for making permanent water supply improvements. The intention of the supervisors was and is to use the proposed funds to pay for the contemplated system in its entirety ($270,000) and to amortize the bonded indebtedness over a period of years with the proceeds of an annual 5 mills tax on all taxable real property within the township. This tax would not be used to maintain the revolving fund created by the issuance
of the bonds, but instead would be used to liquidate the bonds. On May 21, 1957, the electorate approved the proposed action by a vote of 164 to 38.
Each of the plaintiffs, St. Joseph Lead Company and Koppers Company, Inc., owns and operates a large manufacturing establishment in the township. Together they own 92.3% of all taxable real property situate in the township. Each owns and operates an independent water supply system which is adequate for all its needs, present and contemplated. Neither plaintiff intends to make use of the proposed water system. On June 25, 1957, the plaintiffs filed their complaint in equity which after hearing led to the present injunction.
Plaintiffs offer two grounds for the issuance of the injunction, (1) that the proposed means of financing the system would constitute a taking of plaintiffs' property in violation of the Pennsylvania and Federal Constitutions, and (2) that a second class township does not have the necessary statutory authority to finance the construction of a water system through the issuance of general obligation bonds. The court below negatived the first contention, but sustained the second.
Is the proposed action authorized by the Second Class Township Code? Act of May 1, 1933, P.L. 103, art. I, § 101, as amended by Act of July 10, 1947, p.L. 1481, § 1, 53 P.S. § 65101 et seq. In the ownership and operation of a water facility, the municipality stands on the same footing as a private corporation. Jolly v. Monaca Borough, 216 Pa. 345, 65 Atl. 809 (1907). Townships, however, possess and exercise only such powers as are granted by the legislature in express words or are necessarily or fairly implied in or incident to those expressly granted or those which are indispensable to ...