               IN THE COURT OF APPEALS OF NORTH CAROLINA

                                   No. COA18-806

                                  Filed: 2 July 2019

Brunswick County, No. 15 CVS 2214

BOBBY G. BOLES, et al., Plaintiffs,

              v.

TOWN OF OAK ISLAND, Defendant.


        Appeal by plaintiffs from order entered 2 May 2018 by Judge James Ammons,

Jr., in Brunswick County Superior Court. Heard in the Court of Appeals 17 January

2019.


        Smith James Rowlett & Cohen LLP, by Norman B. Smith, for plaintiffs-
        appellants.

        Parker, Poe, Adams, & Bernstein LLP, by Charles C. Meeker and Stephen V.
        Carey; and Crossley, McIntosh & Collier, by Brian E. Edes, for defendant-
        appellee.


        ZACHARY, Judge.


        Plaintiffs, owners of undeveloped parcels of property in Defendant Town of Oak

Island, challenge the sewer service availability fees levied upon them pursuant to a

2004 local act enacted to help service the debt incurred in constructing Oak Island’s

sewer system.      Plaintiffs argue that the fees are unauthorized by statute,

unconstitutional, and violative of certain tax principles. After careful review, we

conclude that Oak Island exceeded its statutory authority by imposing the sewer

service availability fees on Plaintiffs’ undeveloped property that could not or does not
                                 BOLES V. TOWN OF OAK ISLAND

                                         Opinion of the Court



benefit from the availability of Oak Island’s sewer system. Accordingly, we reverse

the trial court’s order granting summary judgment in favor of Oak Island and remand

for further proceedings.

                                          I. Background

        The Town of Oak Island constructed a sewer system at a cost of $140 million.

In 2004, the General Assembly enacted a local act1 designed to assist Oak Island2 in

reducing its resultant outstanding debt, which was approximately $117 million as of

October 2017. 2004 N.C. Sess. Laws 117, ch. 96. Specifically, the General Assembly

authorized Oak Island to “impose annual fees for the availability of sewer service

within” its sewer treatment district. 2004 N.C. Sess. Laws 117, 117, ch. 96, § 3. The

Session Laws authorize Oak Island to impose such sewer service availability fees

upon the “owners of each dwelling unit or parcel of property that could or does benefit

from the availability of sewage treatment” within the district. 2004 N.C. Sess. Laws

117, 117, ch. 96, § 4.

        Oak Island’s sewer lines run in front of each parcel of property on the island,

both developed and undeveloped, and, according to Oak Island, its system “has the

capacity and ability to serve all parcels, both developed and undeveloped.” Oak



        1“A local act refers to an act of the General Assembly that relates to one or more specific local
governments.” Frayda Bluestein, Coates’ Canons Blog: What Is A Local Act?, UNC School of
Government (April 6, 2010), https://canons.sog.unc.edu/what-is-a-local-act/.
       2 The original 2004 Session Law applied only to Holden Beach, with the 2006 Session Law

adding Oak Island to the same authority. 2006 N.C. Sess. Laws 85, 85, ch. 54, § 1. The 2010 Session
Law added Caswell Beach. 2010 N.C. Sess. Laws 34, 34, ch. 29, § 1.

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                                BOLES V. TOWN OF OAK ISLAND

                                        Opinion of the Court



Island began to assess sewer service availability fees against all properties within the

district, both developed and undeveloped.

      Beginning in fiscal year 2009,3 owners of developed property began paying the

availability fees via an additional charge reflected on their monthly sewer bills.

Owners of undeveloped parcels began paying the availability fees on an annual basis

in fiscal year 2010, with the fees appearing on their property tax bills. The total

sewer service availability fees charged to each parcel thus far are as follows:

 Fiscal Year                       Developed                        Undeveloped
 2010                              $733.26                          $146.15
 2011                              $435.46                          $146.15
 2012                              $324.63                          $139.13
 2013                              $490.81                          $576.00
 2014                              $657.61                          $643.68
 2015                              $714.78                          $719.31
 2016                              $559.74                          $803.83
 2017                              $562.28                          $803.83


These recurring sewer service availability fees are in addition to a one-time special

assessment of $4,200.00, which was imposed upon all parcels of property at the outset

of the sewer system’s establishment. It is also noteworthy that for the years 2015

through 2017, owners of undeveloped lots were paying more than the owners of

developed lots that were connected to and using the sewer system.




      3   For the Town of Oak Island, a fiscal year runs from July 1 through June 30.

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                           BOLES V. TOWN OF OAK ISLAND

                                  Opinion of the Court



      On 11 December 2015, Plaintiffs filed the instant action challenging Oak

Island’s statutory authority to assess the sewer service availability fees against

Plaintiffs’ undeveloped property. Plaintiffs sought to recover the fees paid from 2010

to 2014, and interest, together with a declaratory judgment that the fees are

unlawful. On 21 April 2017, Plaintiffs moved to certify a class of all undeveloped

parcel owners who have paid the sewer service availability fees since 2009.

      The parties filed cross-motions for summary judgment in October 2017.

Plaintiffs moved for summary judgment on the issue of liability only, while Oak

Island moved for summary judgment on all issues.          A hearing on the parties’

summary judgment motions was held on 16 April 2018. At the outset of the hearing,

Plaintiffs voluntarily dismissed their claim for declaratory judgment without

prejudice, leaving only their claim for the recovery of fees paid from 2010 to 2014. At

the end of the hearing, Plaintiffs orally moved to amend the pleadings pursuant to

Rule 15(b) of the North Carolina Rules of Civil Procedure, or alternatively, to

supplement their complaint pursuant to Rule 15(d), in order to bring claims for

recovery of sewer service availability fees paid in fiscal years 2015 through 2017. Oak

Island objected to the motion.

      Without ruling on Plaintiffs’ motion to amend, the trial court denied Plaintiffs’

motion for partial summary judgment and granted Oak Island’s motion for summary

judgment. In light of these rulings, the trial court also did not rule upon Plaintiffs’



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                                   Opinion of the Court



motion for class certification. On 2 May 2018, the trial court entered an order

memorializing its decision and taxing the costs against Plaintiffs. Plaintiffs filed

notice of appeal to this Court on 21 May 2018.

      On appeal, Plaintiffs contend that the trial court erred by granting Oak

Island’s motion for summary judgment because (1) the statutory phrase “availability

of sewer service” precludes Oak Island from assessing sewer service availability fees

against undeveloped properties; (2) Oak Island provided a full credit or rebate of the

availability fees to owners of developed parcels, thereby violating Plaintiffs’

constitutional rights and certain tax principles; and (3) refunds were provided to

owners of developed parcels in violation of N.C. Gen. Stat. § l05-380(a). Finally,

Plaintiffs argue that the trial court erred in failing to grant their motion to amend

the pleadings.

                                    II. Discussion

      a. Standard of Review

      Summary judgment is proper “if the pleadings, depositions, answers to

interrogatories, and admissions on file, together with the affidavits, if any, show that

there is no genuine issue as to any material fact and that any party is entitled to a

judgment as a matter of law.” N.C. Gen. Stat. § 1A-1, Rule 56(c) (2017). Our standard

of review on appeal from an order granting summary judgment is de novo. In re Will

of Jones, 362 N.C. 569, 573, 669 S.E.2d 572, 576 (2008).



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                            BOLES V. TOWN OF OAK ISLAND

                                   Opinion of the Court



      b. Statutory Authority to Assess Sewer Service Availability Fees

      We first address Plaintiffs’ argument that the trial court erred in granting

summary judgment in favor of Oak Island because Oak Island exceeded its statutory

authority under the Session Laws by assessing the sewer service availability fees

against Plaintiffs’ undeveloped properties. Specifically, Plaintiffs argue that their

undeveloped properties are not ones that “could or do[] benefit from the availability”

of Oak Island’s sewage treatment services. We agree, and therefore reverse the trial

court’s order granting summary judgment in favor of Oak Island on this ground.

      “As creations of the legislature, municipalities have only those powers

delegated to them by the General Assembly.” Quality Built Homes, Inc. v. Town of

Carthage, 369 N.C. 15, 16, 789 S.E.2d 454, 455 (2016). “The General Assembly

delegates express power to municipalities by adopting an enabling statute, which

includes implied powers essential to the exercise of those which are expressly

conferred.” Id. at 19, 789 S.E.2d at 457 (quotation marks and alteration omitted).

Otherwise, “[a]ll acts beyond the scope of the powers granted to a municipality are

invalid.” Id.

      “When determining the extent of legislative power conferred upon a

municipality, the plain language of the enabling statute governs.” Id. “When the

language of a statute is clear and without ambiguity, it is the duty of this Court to

give effect to the plain meaning of the statute, and judicial construction of legislative



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                             BOLES V. TOWN OF OAK ISLAND

                                   Opinion of the Court



intent is not required.” Diaz v. Div. of Soc. Servs., 360 N.C. 384, 387, 628 S.E.2d 1, 3

(2006) (citation omitted).

      In the instant case, although the Session Laws do not define the term

“availability” for purposes of imposing the sewer service availability fees, it is clear

that the enabling Session Laws do not, as a matter of law, apply to Plaintiffs’

undeveloped property.

      “In the event that the General Assembly uses an unambiguous word without

providing an explicit statutory definition, that word will be accorded its plain

meaning.” Fid. Bank v. N.C. Dep’t of Revenue, 370 N.C. 10, 19, 803 S.E.2d 142, 149

(2017). The plain meaning of the unambiguous, undefined word “availability” is “the

quality or state of being available.”           Availability, MERRIAM-WEBSTER.COM,

https://www.merriam-webster.com/dictionary/availability (last visited May 31, 2019).

“Available” means “present or ready for immediate use.”          Available, MERRIAM -

WEBSTER.COM, https://www.merriam-webster.com/dictionary/available (last visited

May 31, 2019).

      As noted in Oak Island’s answer to Plaintiffs’ first set of interrogatories, in

order to “benefit from the availability” of Oak Island’s sewer system, the owner of an

undeveloped parcel of property would first be required to (1) obtain the requisite

building permits; (2) construct a dwelling or building with a sewer system connection

on the property; (3) have the improvements pass municipal inspection; (4) obtain a



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                           BOLES V. TOWN OF OAK ISLAND

                                  Opinion of the Court



plumbing permit; (5) submit an application for service; and (6) meet any additional

requirements governing the improvement of property set forth in the Town of Oak

Island Code of Ordinances. Should the system have the capacity to add and serve the

parcel, an owner of undeveloped property who wished to connect to the system would

also have to pay the requisite fees to Oak Island in order to obtain the various

permits. The complex, costly additional requirements—many of them conditional—

that the owner of an undeveloped lot must fulfill in order to benefit from Oak Island’s

sewer services foreclose any conclusion that such services are “present or ready for

immediate use” by those owners.

      Our conclusion is supported by Ricks v. Town of Selma, 99 N.C. App. 82, 392

S.E.2d 437 (1990), disc. review improvidently allowed, 328 N.C. 567, 402 S.E.2d 400

(1991), in which this Court addressed the validity of an availability charge in the

context of water and sewer treatment services. At issue in Ricks was the validity of

the defendant Town of Selma’s ordinance that set “rates for . . . sewer service

available but not received[.]” 99 N.C. App. at 84, 392 S.E.2d at 438. The plaintiffs

were the owners of a 41-unit mobile-home park located inside the Town’s limits,

which utilized its own private septic tanks instead of the Town’s sewer system. Id.

at 83, 392 S.E.2d at 438.     The Town assessed availability charges against the

plaintiffs, who contended that the Town had exceeded the scope of its statutory




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                                   Opinion of the Court



authority, in that the plaintiffs were not using the Town’s services. Id. at 84, 392

S.E.2d at 438-39. We disagreed.

      The authorizing statute in Ricks permitted the Town to enact an ordinance

“establish[ing] rates for the use of or the services furnished by any public enterprise.”

Id. at 84-85, 392 S.E.2d at 439 (quotation marks omitted) (citing N.C. Gen. Stat. §

160A-314(a)).   The question presented thus was “whether making sewer service

available is ‘furnishing a service’ within the meaning of the statute.” Id. at 85, 392

S.E.2d at 439. We held that the Town’s ordinance was statutorily authorized as

against the plaintiffs, concluding that “a city’s power to set rates for services

furnished by a sewer system includes the power to charge for services available but

not received,” where the property is developed, but the owner chooses not to connect.

Id. at 86, 392 S.E.2d at 440.

      While the term “available” was not explicitly defined in Ricks or the relevant

statute, the facts that were held to evidence “availability of service” are clearly

distinguishable from those of the case at bar. In Ricks, the Town had extended water

and sewer service to the plaintiffs’ mobile home park; the plaintiffs chose to “tap[]

onto the municipal water service, but . . . never connected any of their 41 housing

units to the . . . sewer system[,]” preferring instead to use their existing septic tanks.

Id. at 83, 392 S.E.2d at 438. In other words, the Town’s sewer services were present

and ready for immediate use by the Ricks plaintiffs, who simply opted not to connect



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                                   Opinion of the Court



to the system. Moreover, unlike the undeveloped property in the present case, the

plaintiffs’ property in Ricks was already developed and generating sewage, and the

Town had authorized the units’ connection to the system.

      Our holding finds further support in the circumstances under which property

may be subject to an “availability charge” pursuant to N.C. Gen. Stat. § 160A-317,

which governs a municipality’s authority to require property owners to connect to its

sewer facilities and to charge for such connections.         Specifically, the statute

authorizes municipalities to “require an owner of developed property on which there

are situated one or more residential dwelling units or commercial establishments . . .

to connect the owner’s premises with the [city’s] . . . sewer line.” N.C. Gen. Stat. §

160A-317(a) (emphasis added).       Alternatively, municipalities may subject such

owners to “a periodic availability charge” in lieu of connection. Id.

      The Session Laws’ language “could . . . benefit from the availability of sewage

treatment” follows the same logic of section 160A-317.     2004 N.C. Sess. Laws 117,

117, ch. 96, § 4. The fact that it would be outside the scope of Oak Island’s authority

under N.C. Gen. Stat. § 160A-317 to charge Plaintiffs an “availability charge” for its

sewer services suggests that those services are similarly not “available” to Plaintiffs

for purposes of the Session Laws. See, e.g., In re Halifax Paper Co., 259 N.C. 589,

594, 131 S.E.2d 441, 445 (1963) (“[I]t is the duty of the courts to reconcile laws and




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                                          Opinion of the Court



adopt the construction of a statute which harmonizes it with other statutory

provisions.”).

        Also instructive, though lacking precedential value, is Holmes Harbor Sewer

Dist. v. Holmes Harbor Home Bldg. LLC, 123 P.3d 823 (Wash. 2005), in which the

Washington Supreme Court directly addressed the meaning of “availability” of sewer

services. 123 P.3d at 825-26. Similar to the statutory scheme at issue in this case,

the Washington statute permitted the district to “fix[] rates and charges for

furnishing sewer and drainage service and facilities to those to whom service is

available.” Id. at 824-25. The Washington Supreme Court held in favor of an owner

of unimproved property who had refused to pay the availability charges. Id. at 827.

Specifically, the Court concluded that “unimproved lots are not properties to which

sewer service is available,” and therefore, “the charges at issue [we]re not statutorily

authorized.”4 Id. at 823.

        As Oak Island did, the sewer district in Holmes Harbor initially charged a

special assessment to all property owners of both improved and unimproved parcels



        4  The dissent cites Durango W. Metro. Dist. #1 v. HKS Joint Venture P’ship, 793 P.2d 661
(1990), and McMillan v. Texas Natural Res. Conservation Comm’n, 983 S.W.2d 359 (1998), as
instructive opinions from other jurisdictions, which stand for the contrary proposition. The holdings
of those cases are misconstrued. The property owner in Durango had only argued (1) that the sewer
district did not fall within the statutory definition of a “municipality,” and thus lacked the authority
to impose availability of service charges altogether, and (2) that the availability fees were subject to a
statutory “fifty percent of . . . regular service charges” limitation. Durango W. Metro. Dist. #1, 793
P.2d at 663. The property owner did not argue that the district had exceeded its statutory authority
by assessing availability fees against the plaintiff’s vacant, unimproved property. In McMillan, the
pertinent statute explicitly authorized the assessment of standby fees for available sewer services
against “undeveloped property.” McMillan, 983 S.W.2d at 361 (emphasis added).

                                                 - 11 -
                            BOLES V. TOWN OF OAK ISLAND

                                  Opinion of the Court



and later imposed additional availability charges. The availability charges were

assessed against unimproved properties, unconnected to the system and generating

no sewage, as well as those developed, connected, and actually receiving services.

Moreover, as here, owners of unimproved property had “no guaranteed right to

connect to the sewer system.” Id. at 824. Should there be sufficient capacity, the

Washington sewer district reserved the right to authorize any new connections.

However, “[b]efore authorizing connection, the [d]istrict [had to] approve the hookup

application, and upon approval by the [d]istrict, property owners [then had to] pay

for the installation of on-site facilities and connection to the sewer system.” Id. at

827. Finding that the initial assessment had compensated the district for “the special

benefit of potentially increased property values resulting from the construction of the

sewer system,” id. at 826 n.5, the Court concluded that justifying the availability

charges would require more than a nebulous opportunity to connect to the system at

some undetermined future date. See id. at 826-27. Accordingly, the Court held that

sewer service was not available where “the properties at issue are not improved, are

not connected to the sewer system, and have no guaranteed right to connect upon

improvement.” Id. at 827.

      Similarly here, Plaintiffs’ undeveloped properties are not ones that “could or

do[] benefit from the availability of” Oak Island’s sewer treatment services. 2004 N.C.

Sess. Laws 117, 117, ch. 96, § 4 (emphasis added). The undeveloped properties are



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                            BOLES V. TOWN OF OAK ISLAND

                                   Opinion of the Court



not connected to or being served by the municipal sewer service, and “have no

guaranteed right to connect.” Holmes Harbor, 123 P.3d at 827. Thus, the sewer

service is not available to the owners of such properties. Consequently, beyond the

initial assessment imposed, Oak Island’s additional and ongoing charges to Plaintiffs,

as owners of undeveloped properties, for sewer service availability was not a valid

exercise of statutory authority pursuant to Session Law 2004-96.

      In light of our decision, we do not address Plaintiffs’ additional arguments

concerning the tax credit provided to developed property owners and not to

undeveloped property owners.

      c. Motions to Amend Pleadings

      Finally, Plaintiffs argue that the trial court erred by failing to grant their oral

motions to amend or supplement their complaint pursuant to Rule 15(b) and (d) of

the North Carolina Rules of Civil Procedure. However, because Plaintiffs failed to

obtain rulings on these motions, there is no judicial action for this Court to review at

this time.

      “In order to preserve an issue for appellate review, a party must have

presented to the trial court a timely . . . motion, stating the specific grounds for the

ruling the party desired the court to make if the specific grounds were not apparent

from the context.” N.C.R. App. P. 10(a)(1). “It is also necessary for the complaining

party to obtain a ruling upon the party’s . . . motion.” Id.



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                                 BOLES V. TOWN OF OAK ISLAND

                                         Opinion of the Court



        At the outset of the hearing, Plaintiffs took a voluntary dismissal of their

declaratory judgment claim.            At that point, Defendant noted that “[s]ince the

damages requested are only from 2010 to 2014, now there’s no request for beyond

2015.” At the end of the hearing, Plaintiffs moved to amend their complaint, pursuant

to Rule 15(b), to include damages for sewer service availability fees paid during fiscal

years 2015 through 2017. Plaintiffs argued that damages for these years had been

tried by consent because Oak Island’s Exhibit D included sewer service availability

fees charged to landowners for fiscal years 2010 through 2017. In the alternative,

Plaintiffs argued that they should be allowed to supplement their complaint pursuant

to Rule 15(d). Oak Island objected to Plaintiffs’ motion to amend their complaint,

arguing that it did not try the issue of damages in those years by consent.5

        After the hearing, the trial court announced its decision to deny Plaintiffs’

motion for partial summary judgment and grant Oak Island’s motion for summary

judgment. However, the trial court did not decide or rule upon Plaintiffs’ Rule 15

motions. Because Plaintiffs did not obtain rulings upon their Rule 15 motions, they

failed to preserve for appeal any arguments concerning the same. See id.; Gilreath v.

N.C. Dep’t of Health & Human Servs., 177 N.C. App. 499, 501, 629 S.E.2d 293, 294




        5   Oak Island reminded the trial court that when Plaintiffs dismissed their declaratory
judgment action, Oak Island had notified the court that damages for fiscal years 2015 through 2017
were no longer applicable. Oak Island also explained that Exhibit D was prepared in response to
Plaintiffs’ request for declaratory judgment, but, that it probably would not have submitted this exhibit
had it known that Plaintiffs were going to dismiss their declaratory judgment claim.

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                            BOLES V. TOWN OF OAK ISLAND

                                   Opinion of the Court



(holding that the plaintiff’s argument that the trial court erred in failing to grant the

plaintiff’s motion to strike paragraphs from affidavits was unpreserved because the

plaintiff did not obtain a ruling on that motion), aff’d per curiam, 361 N.C. 109, 637

S.E.2d 537 (2006). These arguments are not before us at this time.

                                   III. Conclusion

      The trial court’s order granting summary judgment in favor of Oak Island is

reversed and remanded.

      REVERSED AND REMANDED.

      Judge TYSON concurs.

      Judge COLLINS concurs in part and dissents in part by separate opinion.




                                          - 15 -
No. COA18-806 – Boles v. Town of Oak Island


      COLLINS, Judge, concurs in parts and dissents in part.


      Plaintiffs, owners of undeveloped parcels of property in the Town of Oak

Island, challenge fees levied upon them by Defendant Town of Oak Island for

payment of sewer system debt service, pursuant to a 1996 session law. Plaintiffs

argue the fees are unauthorized by statute, unconstitutional, and violative of certain

tax principles, and seek declaratory judgment and recovery of the fees. Because I

conclude Plaintiffs’ arguments lack merit, I would affirm the trial court’s order

granting summary judgment in favor of Defendant Town of Oak Island. I therefore

respectfully dissent. However, I concur with the majority that Plaintiffs failed to

preserve for our appellate review any issue regarding their oral motions to amend or

supplement their complaint.

                              I. Procedural History

      By Complaint filed 11 December 2015 and Amended Complaint filed 15

January 2016 (collectively Complaint), Plaintiffs, owners of undeveloped parcels of

property in the Defendant Town of Oak Island (Town or Oak Island), challenged

sewer district fees (Fee or Fees) Oak Island was collecting to pay debt service on its

sewer system.    Plaintiffs sought to recover Fees paid from 2010 to 2014, and

declaratory judgment that the Fees are unlawful.         Oak Island answered the

Complaint, denied its material allegations, and moved to dismiss the Complaint. On
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



21 April 2017, Plaintiffs moved to certify a class of all undeveloped parcel owners who

have paid Fees since 2009.

      In October 2017, the parties filed cross-motions for summary judgment.

Plaintiffs moved for summary judgment on the issues of liability only while Oak

Island moved for summary judgment on all issues.

      A hearing on the parties’ summary judgment motions was held on 16 April

2018. At the outset of the hearing, Plaintiffs took a voluntary dismissal without

prejudice of their prayer for declaratory judgment, leaving only their claim for the

recovery of Fees paid from 2010 to 2014.

      At the end of the hearing, Plaintiffs orally moved to amend the pleadings under

North Carolina Rules of Civil Procedure 15(b) and to supplement the complaint under

N.C. R. Civ. P. 15(d) to bring claims for recovery of Fees paid in 2015, 2016, and 2017.

Oak Island objected to the motion. Without ruling on Plaintiffs’ motion to amend the

pleadings, the trial court denied Plaintiffs’ motion for partial summary judgment and

granted Oak Island’s motion for summary judgment. In light of these rulings, the

trial court did not consider Plaintiffs’ class certification motion. On 2 May 2018, the

trial court entered an Order reflecting its ruling and taxing costs against Plaintiffs.

Plaintiffs filed Notice of Appeal to this Court on 21 May 2018.

                               II. Factual Background




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                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



      Oak Island constructed a sewer system at a cost of $140 million. As of October

2017, the principal amount of indebtedness for the system was approximately $117

million. Sewer lines run in front of each parcel of property on Oak Island, both

developed and undeveloped, and the sewer system has the capacity and ability to

serve all parcels of property on Oak Island.

      Starting in 2004, the General Assembly adopted legislation to assist Oak

Island and two other towns in amortizing their sewer system debt. Specifically, the

General Assembly enacted three Session Laws authorizing the towns to create fee-

supported sewer treatment districts and impose sewer district fees to pay the debt

service on their sewer systems. A 2004 session law applied to Holden Beach. See

2004 N.C. Sess. Law 96 (2004). A 2006 session law added Oak Island to the sewer

district fee authority previously granted to Holden Beach. See 2006 N.C. Sess. Law

54 (2006). A 2010 session law broadened the authority granted to include Caswell

Beach. See 2010 N.C. Sess. Law 29 (2010).

      The relevant portions of the 2006 session law applicable to Oak Island (Session

Law) provide:

             SECTION 1. Fee-Supported District. – A municipality may
             create a fee-supported sewer treatment district for all
             properties that are or can be served by the sewage
             collection and treatment plant serving properties within
             the Town.

             ....



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                                 BOLES V. TOWN OF OAK ISLAND

                       COLLINS, J. concurring in part and dissenting in part



               SECTION 3. Imposition of Annual Fees. – The Town may
               impose annual fees for the availability of sewer service
               within the district. The Board shall set same on or before
               July 1 each year.

               SECTION 4. Fees. – The fees imposed by the municipality
               may not exceed the cost of providing the sewer collection
               facility within the municipality and the cost of the contract
               with a county to provide it with the facilities to transport,
               treat, and dispose of the municipality’s effluent. Said fees
               shall be imposed on owners of each dwelling unit or parcel
               of property that could or does benefit from the availability
               of sewage treatment.

               SECTION 5. Billing of Fees. – The municipality may
               include a fee imposed under this section on the property
               tax bill for each parcel of property lying within the
               municipal limits on which the fee is imposed. Said fee shall
               be collected in the same manner as provided for in the
               General Statutes for the collection of ad valorem taxes, and
               remedies available by statute for the collection of taxes
               shall apply to the collection of the sewer district fees.

               SECTION 6. Use of Fees. – The Town shall credit the fees
               collected within the district to a separate fund to be used
               only to pay the debt service for the sewer system. . . .

S.L. 2006-54 (amending S.L. 2004-96).6

       Debt service on Oak Island’s sewer system is paid from (1) assessments paid

by all parcel owners, (2) monthly fees paid by developed parcel owners currently using

the system, and (3) yearly fees paid by undeveloped parcel owners. Starting in fiscal


        6 The relevant text of S.L. 2006-54 appears in the body of S.L. 2004-96. The text of S.L. 2006-

54 indicates that Section 8 of S.L. 2004-96 reads as rewritten: “SECTION 8. This act applies only
within the Town of Holden Beach Towns of Holden Beach and Oak Island.”




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                                 BOLES V. TOWN OF OAK ISLAND

                       COLLINS, J. concurring in part and dissenting in part



year 2009,7 owners of developed parcels began paying debt service fees via a monthly

charge for basic sewer service, covering debt service and operating costs, along with

a usage charge for service over 4,000 gallons per month. In fiscal year 2010, owners

of undeveloped parcels began paying sewer district Fees once a year, with the Fee

appearing on their yearly property tax bill.

       Even though owners of developed parcels pay debt service fees on a monthly

basis, a yearly sewer district Fee also appears on their annual property tax bill. This

Fee is credited back on the same annual property tax bill such that owners of

developed parcels are not double-billed for debt service payments. By collecting debt

service fees from developed parcel owners monthly, Oak Island pays down the sewer

system debt faster than if it collected the sewer district Fees on a yearly basis.

       The debt service payments paid by each type of parcel during the years at

issue8 are as follows:

 Fiscal Year                       Developed                         Undeveloped
 2010                              $733.26                           $146.15
 2011                              $435.46                           $146.15
 2012                              $324.63                           $139.13
 2013                              $490.81                           $576.00
 2014                              $657.61                           $643.68



       7  “Fiscal year 2009” means the time period of 1 July 2008 through 30 June 2009. Other fiscal
year references are computed the same way.
        8 Plaintiffs failed to obtain rulings on their oral motions to amend their complaint under Rule

15(b) or supplement their complaint under Rule 15(d) of the Rules of Civil Procedure to bring claims
for recovery of Fees paid in 2015, 2016, and 2017. Accordingly, these arguments are not preserved for
our appellate review. See Section V.A. Therefore, the only issue before this court is Plaintiffs’
complaint for recovery of Fees paid during the years 2010-14.

                                                  5
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part




                                        III. Issues

      On appeal, Plaintiffs assert the trial court erred by (1) failing to grant

Plaintiffs’ motion to amend their Complaint; (2) failing to grant Plaintiffs’ motion to

supplement their Complaint; (3) granting Defendant’s motion for summary judgment

because the term “availability of sewer service” in the Session Law cannot be

harmonized with N.C. Gen. Stat. § l60A-3l7(a); (4) granting Defendant’s motion for

summary judgment because Defendant provided a full credit or rebate of the sewer

district fee to owners of developed parcels, thereby violating Plaintiffs’ constitutional

rights and certain tax principles; and (5) granting Defendant’s motion for summary

judgment because refunds were provided to owners of developed parcels in violation

of N.C. Gen. Stat. § l05-380(a).

                               IV. Standard of Review

      Summary judgment is proper “if the pleadings, depositions, answers to

interrogatories, and admissions on file, together with the affidavits, if any, show that

there is no genuine issue as to any material fact and that any party is entitled to a

judgment as a matter of law.” N.C. Gen. Stat. § 1A-1, Rule 56(c) (2018). Our standard

of review of an appeal from an order granting summary judgment is de novo. In re

Will of Jones, 362 N.C. 569, 573, 669 S.E.2d 572, 576 (2008). Moreover, appellate




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                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



review of constitutional challenges is de novo. See generally Hart v. State, 368 N.C.

122, 130, 774 S.E.2d 281, 287 (2015).

                                     V. Discussion

A. Motions to Amend or Supplement Complaint

      Because Plaintiffs failed to obtain rulings on their oral motions to amend their

complaint under Rule 15(b) or supplement their complaint under Rule 15(d) of the

Rules of Civil Procedure to bring claims for recovery of Fees paid in 2015, 2016, and

2017, I agree with the majority that these arguments are not preserved for our

appellate review. See N.C. R. App. P. 10(a)(1) (“In order to preserve an issue for

appellate review . . . [i]t is also necessary for the complaining party to obtain a ruling

upon the party’s request, objection, or motion.”); Gilreath v. N.C. Dep’t of Health &

Human Servs., 177 N.C. App. 499, 501, 629 S.E.2d 293, 294 (2006) (holding plaintiff

failed to preserve an argument that the trial court erred in failing to grant plaintiff’s

motion to strike paragraphs from affidavits because plaintiff failed to obtain a ruling

on the motion).

      Therefore, the only issue before this court is Plaintiffs’ complaint for recovery

of Fees paid during the years 2010-14.

B. Statutory Authority to Assess Sewer District Fees




                                             7
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



      Plaintiffs advance several arguments as to why Oak Island lacked the

statutory authority to impose the Fees upon owners of undeveloped parcels. I address

and reject each argument.

Meaning of the term “availability of service”

      The Session Law authorizes Oak Island to “create a fee-supported sewer

treatment district for all properties that are or can be served by the sewage collection

and treatment plant serving properties within the Town.” S.L. 2006-54 § 1. Annual

fees may be imposed “for the availability of sewer service within the district.” S.L.

2006-54 § 3. “Said fees shall be imposed on owners of each dwelling unit or parcel of

property that could or does benefit from the availability of sewage treatment.” S.L.

2006-54 § 4. Plaintiffs argue that the term “availability of sewer service” does not

relate to owners whose parcels are undeveloped in that “service is not available” to

them because they must take additional steps to connect to the sewer system.

Plaintiffs misconstrue the plain language of the Session Law.

      “The primary rule of construction of a statute is to ascertain the intent of the

legislature and to carry out such intention to the fullest extent.” Burgess v. Your

House of Raleigh, Inc., 326 N.C. 205, 209, 388 S.E.2d 134, 137 (1990) (citation

omitted). “The best indicia of that intent are the language of the statute . . . , the

spirit of the act[,] and what the act seeks to accomplish.” Coastal Ready-Mix Concrete

Co. v. Bd. of Comm’rs, 299 N.C. 620, 629, 265 S.E.2d 379, 385 (1980) (citations



                                             8
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



omitted). Thus, “[i]n resolving issues of statutory construction, we look first to the

language of the statute itself.” Walker v. Bd. of Tr. of the N.C. Local Gov’t. Emp. Ret.

Sys., 348 N.C. 63, 65, 499 S.E.2d 429, 430 (1998) (quotation marks and citation

omitted). “When the language of a statute is clear and without ambiguity, it is the

duty of this Court to give effect to the plain meaning of the statute, and judicial

construction of legislative intent is not required.” Diaz v. Div. of Soc. Servs., 360 N.C.

384, 387, 628 S.E.2d 1, 3 (2006) (citation omitted).

       While the Session Law does not define the term “availability,” the ordinary

meaning of “availability” is the state of being “present or ready for immediate use[.]”

Availability,       Merriam-Webster              Dictionary,         https://www.merriam-

webster.com/dictionary/availability (last visited April 16, 2019); see Fid. Bank v. N.C.

Dep’t of Revenue, 370 N.C. 10, 19, 803 S.E.2d 142, 149 (2017) (“In the event that the

General Assembly uses an unambiguous word without providing an explicit statutory

definition, that word will be accorded its plain meaning.”).                The Session Law

authorizes the imposition of fees “for the availability of sewer service within the

district.”   S.L. 2006-54 § 3 (emphasis added).         The district is comprised of “all

properties that are or can be served by the sewage collection and treatment plant

serving properties within the Town.” S.L. 2006-54 § 1 (emphasis added). Thus, the

Session Law authorizes Oak Island to impose fees for the sewer service’s presence or




                                             9
                            BOLES V. TOWN OF OAK ISLAND

                   COLLINS, J. concurring in part and dissenting in part



readiness for use by all properties that are or can be served by the Town’s sewage

collection and treatment plant.

      Oak Island’s Chief Financial Officer, David Hatten, stated in his

uncontradicted affidavit that Oak Island installed a sewer system and that “[s]ewer

lines run in front of each parcel on Oak Island, both developed and undeveloped. Oak

Island’s sewer system has the capacity and ability to serve all parcels both developed

and undeveloped.” These undisputed averments compel the conclusion that the

sewer service is present or ready for immediate use by all properties that are or can

be served by the Town’s sewage collection and treatment plant, including

undeveloped parcels of property. Plaintiffs’ parcels, while not presently served by the

Town’s sewage collection and treatment plant, “can be served” by the Town’s sewage

collection and treatment plant when they are connected to the sewer lines in the

future.

      Moreover, the Session Law contemplates the levying of fees upon owners of

undeveloped parcels of property that indirectly benefit from the sewer system but are

not currently connected to the system, and that could directly benefit from the system

upon connection. Furthermore, as explained at oral argument, parcels which can

never be developed — and thus can never be served by the sewage collection and

treatment plant — can be exempted from paying Fees.




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                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



      Plaintiffs propose construing the statute to require that a parcel be developed

and presently able to connect to the sewer system before Fees can be imposed.

Plaintiffs’ interpretation would require terms be added to the Session Law, while

rendering the terms “can be served [,]” “within the district[,]” and “parcel of property

that could . . . benefit” superfluous. Such statutory construction is not permitted,

because “[i]n effectuating legislative intent, it is our duty to give effect to the words

actually used in a statute and not to delete words used or to insert words not used.”

Lunsford v. Mills, 367 N.C. 618, 623, 766 S.E.2d 297, 301 (2014) (internal citations

and quotation marks omitted). We construe each word of a statute to have meaning,

where reasonable and consistent with the entire statute, because “it is always

presumed that the legislature acted with care and deliberation . . . .” Batts v. Batts,

160 N.C. App. 554, 557, 586 S.E.2d 550, 553 (2003) (quotation marks and citation

omitted).

      As the plain language of the Session Law authorizes Oak Island to impose Fees

upon all owners of developed and undeveloped parcels of property within the Town of

Oak Island’s fee-supported sewer district as a result of sewer service being available

within the district, Oak Island was authorized to impose Fees upon Plaintiffs.

      This conclusion comports with Ricks v. Town of Selma, 99 N.C. App. 82, 392

S.E.2d 437 (1990), wherein this Court concluded that a town could “set an availability

charge for water or sewer service available but not received.” Id. at 84, 392 S.E.2d at



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                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



438-39. The town had the statutory authority to establish rates “‘for the use of or the

services furnished by any public enterprise.’” Id. at 84-85, 392 S.E.2d at 439 (quoting

N.C. Gen. Stat. § 160A-311(2)). “‘Public enterprise’” included “‘[s]ewage collection.’”

Id. (quoting N.C. Gen. Stat. § 160A-311(3)). The question was “whether making

sewer service available is ‘furnishing a service’ within the meaning of the statute[.]”

Ricks, 99 N.C. at 85, 392 S.E.2d at 439.

      The town had extended water and sewer service to plaintiffs’ property and,

thus, “[b]oth water and sewer service from the Town of Selma were available to

plaintiffs’ property.” Id. at 83, 392 S.E.2d at 438. Plaintiffs did not tap into the

municipal sewer system, choosing instead to continue to use their private septic tank.

This Court concluded that by making sewer service available, i.e., extending the

sewer service to the property, the city had furnished a service, thus authorizing it to

set a rate for this service. Id. at 85, 392 S.E.2d at 439.

      Just as the Town of Selma extended sewer service to plaintiffs’ property in

Ricks, Oak Island has extended sewer service to all parcels on Oak Island, including

Plaintiffs’ properties. Thus, as in Ricks, sewer service was available to all parcels in

Oak Island, including Plaintiffs’ parcels. Moreover, unlike in Ricks where the Court

was interpreting the scope of the rate-setting authority of a broadly applicable

statute, in this case, the narrowly applicable Session Law specifically granted Oak

Island the authority to impose Fees upon Plaintiffs’ as owners of parcels of property



                                             12
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



that can be served by the Town’s sewage collection and treatment plant and that

could benefit from the availability of sewage treatment. S.L. 2006-54 §§ 1, 4.

      Plaintiffs rely heavily upon Holmes Harbor Sewer Dist. v. Holmes Harbor

Home Bldg. LLC, 123 P.3d 823 (Wash. 2005), wherein the court concluded that a

statute authorizing water-sewer districts to charge rates for sewer service and

facilities did not allow a district to assess monthly fees on undeveloped properties.

Id. at 827. Such reliance is misplaced.

      The statute at issue allowed a district to “‘fix[] rates and charges for furnishing

sewer and drainage service and facilities to those to whom service is available . . . .’”

Id. at 824-25 (quoting RCW 57.08.081(1)) (emphasis added). The court concluded that

the text of the statute required “districts to furnish some level of sewer and drainage

service” to an individual in order to impose rates and charges. Holmes, 123 P.3d at

825. The court then analyzed the statutory framework governing the general powers

of water-sewer districts as well as the district’s resolution governing the use of the

system which provided, “Nothing in this Resolution is intended, nor shall it be

construed, to grant to any person or entity any right to connect to the Public Sewer

System” to determine to whom service was available. Id. at 824.

      In holding that RCW 57.08.081(1) did not give the district the authority to

assess monthly fees against undeveloped properties, the court reasoned,

             [t]hough the legislature may not have intended that a
             physical connection be made for sewer service to be


                                             13
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



              available, the language of RCW 57.08.081(1) requires that
              some level of service be furnished.       The statutory
              framework governing water-sewer districts also requires
              more than an uncertain opportunity for an unimproved
              property to connect to the system, especially in this case
              where under the resolution the property owners have no
              right or duty to connect.

Id. at 826.

      Holmes Harbor is not binding on this Court and is nonetheless distinguishable

from the present case. Unlike the plain language of the statute in Holmes Harbor,

which only authorized charges to be assessed against individuals to whom sewer

service was being furnished, the plain language of the Session Law in this case

authorizes Fees to be imposed for the general availability of sewer service within the

district, and specifically authorizes the district to include parcels of property that are

not presently served by the Town’s sewage collection and treatment plant, but could

be.

      Moreover, while the State of Washington’s statutory framework informed the

court’s interpretation of “to whom service is available” and, thus, when an individual

could be charged for sewer service, this Court need not engage in statutory

interpretation of the Session Law’s language, as it plainly authorizes Oak Island to

impose Fees upon all owners of developed and undeveloped parcels of property within

the Town’s fee-supported sewer district as a result of sewer service being available

within the district. See Lunsford v. Mills, 367 N.C. 618, 623, 766 S.E.2d 297, 301



                                             14
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



(2014) (“If the language of the statute is clear and is not ambiguous, we must conclude

that the legislature intended the statute to be implemented according to the plain

meaning of its terms.”).

      Furthermore, while opinions from other jurisdictions interpreting forms of the

word “available” in light of their own statutory schemes and case law may be

instructive, see, i.e., Durango W. Metro D. No. 1 v. HKS Joint Venture P’ship, 793 P.2d

661 (Colo. App. 1990) (concluding the district could charge an availability of service

fee for water and sewer services to vacant unimproved lots within the district);

McMillan v. Texas Nat. Res. Conservation Comm’n, 983 S.W.2d 359 (Tex. App. 1998)

(holding standby fees for available water and sewer services could be charged even

though lots were not connected to the water and sewer mains), they are not

necessarily persuasive, as is the case with Holmes Harbor, and they are not binding

on this Court. What is binding on this Court is the plain meaning of the Session Law,

in keeping with North Carolina case law, which compels a conclusion that Oak Island

was authorized to collect Fees from Plaintiffs.

Harmony with N.C. Gen. Stat. § 160A-317(a)

      Plaintiffs next argue that the Session Law’s term “availability of sewer service”

is not in harmony with the terms of N.C. Gen. Stat. § 160A-317(a), which governs the

power of a city to require connections to water or sewer service. Plaintiffs assert that

because § 160A-317(a) only requires an owner of developed property to connect the



                                             15
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



owner’s premises to a sewer line, or pay a fee in lieu thereof, the Session Law may

only require an owner of a developed property to pay a sewer debt fee. Plaintiffs’

argument lacks merit.

      When statutes “deal with the same subject matter, they must be construed in

pari materia, and harmonized to give effect to each.” Gravel Co. v. Taylor, 269 N.C.

617, 620, 153 S.E.2d 19, 21 (1967). “When, however, the section dealing with a

specific matter is clear and understandable on its face, it requires no construction.”

State ex rel. Utilities Comm’n. v. Lumbee River Elec. Membership Corp., 275 N.C. 250,

260, 166 S.E.2d 663, 670 (1969) (citations omitted).

      Even assuming, for this discussion’s sake, the Session Law and N.C. Gen. Stat.

§ 160A-317(a) deal with the same general subject matter – the regulation of town

sewer systems – each law addresses a different, specific matter regarding such

regulation, and each law is clear and understandable on its face.           Thus, no

construction is needed to give effect to each.

      The Session Law addresses Oak Island’s authority to charge land owners Fees

to pay for sewer debt service. The law specifically allows the creation of a fee-

supported, as opposed to use-supported, sewer treatment district for “all properties

that are or can be served by the sewage collection and treatment plant” and to “impose

annual fees for the availability of sewer service” upon “owners of each dwelling unit




                                             16
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



or parcel of property that could or does benefit from the availability of sewage

treatment.” S.L. 2006-54 §§ 1, 3, 4.

      N.C. Gen. Stat. § 160A-317 addresses a city’s authority to require connections

to water or sewer service and charge for such connections. The law specifically allows

a city to require “an owner of developed property on which there are situated one or

more residential dwelling units or commercial establishments . . . to connect the

owner’s premises with the water or sewer line or both, and may fix charges for the

connections.” N.C. Gen. Stat. § 160A-317(a). The statute further allows the city to

“require payment of a periodic availability charge” in lieu of requiring connection. Id.

      While N.C. Gen. Stat. § 160A-317 applies only to “an owner of developed

property on which there are situated one or more residential dwelling units or

commercial establishments[,]” the Session Law lacks such limiting language, and

explicitly applies to “all properties that are or can be served by the sewage collection

and treatment plant” and to “owners of each dwelling unit or parcel of property that

could or does benefit from the availability of sewage treatment.” S.L. 2006-54 §§ 1,

4.

      Had the legislature intended for the Session Law to impose annual fees for the

availability of sewer service within the district only upon owners of developed

property, the legislature could have mirrored the language in N.C. Gen. Stat. § 160A-

317(a) when drafting the Session Law, making it applicable only to “an owner of



                                             17
                              BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



developed property on which there are situated one or more residential dwelling units

or commercial establishments . . . .”        N.C. Gen. Stat. § 160A-317(a).      But the

legislature did not do so, and we will not read language into the Session Law that is

not reflected therein. N.C. Dep’t of Corr. v. N.C. Med. Bd., 363 N.C. 189, 201, 675

S.E.2d 641, 649 (2009) (We “presum[e] that the legislature carefully chose each word

used.”) (citation omitted).

      I thus conclude that the Session Law granted Oak Island the statutory

authority to impose the Fees upon owners of undeveloped parcels.

C. No “Full Credit or Rebate” of Fees

      Plaintiffs next argue “it was error to grant Defendant’s motion for summary

judgment for the reason that Defendant provided a full credit or rebate of the sewer

district fee to taxpayers on developed lots” thereby: (1) denying Plaintiffs the equal

protection of the law, (2) taking Plaintiffs’ private property for public use without just

compensation, (3) violating the requirement for just and equitable taxation, (4)

violating the requirement for exclusive public purpose of taxes, and (5) violating the

principle of uniformity of taxation. I address each argument in turn.

Equal Protection

      Plaintiffs argue they were denied equal protection of the law “because

[D]efendant provided a full credit or rebate of the sewer district fee to taxpayers on

developed lots[.]” Plaintiffs more specifically argue, “[t]here could be no reasonable



                                             18
                                BOLES V. TOWN OF OAK ISLAND

                       COLLINS, J. concurring in part and dissenting in part



basis for the classifications of improved and unimproved properties, and for the

consequently differential treatment of them, the unimproved properties being

required to pay, and the improved properties being totally subject to refund.”9

       But, as Plaintiffs conceded at oral argument and this opinion details above,

Defendant did not provide a full credit or rebate of the Fees to owners of developed

lots. Owners of developed parcels paid sewer debt service fees on a monthly basis

throughout the year, but were also charged the yearly Fee on their year-end tax bill.

Those owners received a credit in the amount of the Fee on their year-end tax bill to

avoid double-billing them for sewer debt service payments.

       Plaintiffs’ equal protection argument thus fails.

Taking Without Just Compensation

       Plaintiffs next argue that the Fee imposed on undeveloped property owners is

a taking of private property for public use without just compensation, in violation of

Article I, Section 19 of the North Carolina Constitution. Plaintiffs argue that “[t]o

lay a burden on one group of taxpayers for the benefit solely of another group of

taxpayers, is a clear violation of the principle prohibiting taking of private property

for public use without just compensation, and is contrary to Section 19.”




       9  Plaintiffs make no equal protection argument based on any difference in the amount of sewer
debt service fees charged to the developed and undeveloped parcel owners or the methods used to
collect the fees. Those arguments are thus not before us.

                                                 19
                                BOLES V. TOWN OF OAK ISLAND

                       COLLINS, J. concurring in part and dissenting in part



         Plaintiffs’ argument again fails because, as described above, owners of

developed parcels were not given full refunds of the Fees. To the extent Plaintiffs are

arguing that any Fees imposed on the undeveloped property owners are takings,

irrespective of the Fees imposed on developed property owners, this argument too

fails.

         The Federal Takings of the Fifth Amendment of the United States Constitution

forbids the taking of private property by the government without just compensation.

Sullivan v. Pender Cty., 196 N.C. App. 726, 731, 676 S.E.2d 69, 73 (2009) (quotation

marks and citations omitted). “[A]lthough the North Carolina Constitution does not

contain an express provision prohibiting the taking of private property for public use

without payment of just compensation, this Court has inferred such a provision as a

fundamental right integral to the ‘law of the land’ clause in article I, section 19 of our

Constitution.” Finch v. City of Durham, 325 N.C. 352, 362-63, 384 S.E.2d 8, 14 (1989)

(citations omitted).

         “[A] reasonable user fee is not a taking if it is imposed for the reimbursement

of the cost of government services.” United States v. Sperry Corp., 493 U.S. 52, 63

(1989). Moreover, a user fee need not “be precisely calibrated to the use that a party

makes of Government services. . . . All that we have required is that the user fee be

a fair approximation of the cost of benefits supplied.” Id. at 60 (internal quotation

marks and citation omitted); see Massachusetts v. United States, 435 U.S. 444, 468



                                                20
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



(1978) (holding that a federal fee imposed on civil aircraft was a fair approximation

of the cost of the benefits supplied where “[e]very aircraft that flies in the navigable

airspace of the United States has available to it the navigational assistance and other

special services supplied by the United States . . . [a]nd even those aircraft, if there

are any, that have never received specific services from the National Government

benefit from them in the sense that the services are available for their use if needed

and in that the provision of the services makes the airways safer for all users”).

      The Fee in this case is not a taking because it is a “reasonable user fee”

“imposed for the reimbursement of the cost of government services” and is a fair

approximation of the cost of benefits supplied. Sperry, 493 U.S. at 63. The Session

Law specifies that the Fees “may not exceed the cost of providing the sewer collection

facility within the municipality and the cost of the contract with a county to provide

it with the facilities to transport, treat, and dispose of the municipality’s effluent.”

S.L. 2006-54 § 4. Furthermore, the Session Law requires Oak Island to “credit the

fees collected within the District to a separate fund to be used only to pay the debt

service of the sewer system.” Id. at § 6. The Session Law is clear, and Plaintiffs make

no argument to the contrary, that the fees are being “imposed for the reimbursement

of the cost of government services.” Sperry, 493 U.S. at 63.

      Moreover, Plaintiffs are directly and indirectly benefited by Oak Island’s

comprehensive sewer system. Sewer lines are present in front of each parcel of



                                             21
                             BOLES V. TOWN OF OAK ISLAND

                    COLLINS, J. concurring in part and dissenting in part



property and are ready for immediate use when Plaintiffs choose to connect to the

system. Furthermore, Plaintiffs benefit now and in the future from the installation

and maintenance of Oak Island’s comprehensive sewer system which helps prevent

and eliminate hazardous pollution. As our Supreme Court explained in Drysdale v.

Prudden, 195 N.C. 722, 143 S.E. 530 (1928),

             It is a matter of common knowledge that odor from human
             excrement in a fairly thickly settled community will affect
             all around, the shifting wind makes it offensive in the
             entire district. The water and sewer eliminates this
             condition not only the annoyance, but the danger that
             comes from the fly feeding on filth and carrying the germ
             and thus pollute and poison food and drink. A water and
             sewer system eliminates the breeding places. It is a well
             known medical fact that filth breeds typhoid fever and the
             fly carries the germ. See Storm v. Wrightsville Beach, [189
             N.C. 679, 128 S.E. 17 (1925)]. . . . Water, sewer, drainage
             and screening have been of untold value to the human
             family.

Id. at 731, 143 S.E. at 534-35; see also Board of Water & Sewer Comm’rs of the City

of Mobile v. Yarbrough, 662 So.2d 251, 254 (Ala. 1995) (“The citizens . . . are directly

or indirectly affected by the results of the pollution of [public] waters and the

beneficial results to be obtained by the elimination of the pollution will be a public

benefit to the entire community and citizens thereof.”).

      Because the Fees are user fees for benefits Plaintiffs received, Plaintiffs’

takings argument also fails.

Tax-based Arguments



                                             22
                            BOLES V. TOWN OF OAK ISLAND

                   COLLINS, J. concurring in part and dissenting in part



      Plaintiffs next argue that the Fee is actually a “true tax and subject to all of

the principles to taxation.” Based on this premise, Plaintiffs argue that the Fee

violates Article V, Sections 2(1) and 2(2) of the North Carolina Constitution, which

relate to the power of taxation, and N.C. Gen. Stat. § l05-380(a), which relates to tax

refunds.

      Our Supreme Court has recognized that a local assessment for public

improvements is not a tax, as taxes are levied for purposes of general revenue. S. Ry.

Co. v. City of Raleigh, 9 N.C. App. 305, 176 S.E.2d 21 (1970).

             “[L]ocal assessments . . . are not taxes within the meaning
             of that term as generally understood in constitutional
             restrictions and exemptions. They are not levied and
             collected as a contribution to the maintenance of the
             general government, but are made a charge upon property
             on which are conferred benefits entirely different from
             those received by the general public. They are not imposed
             upon the citizens in common at regularly recurring periods
             for the purpose of providing a continuous revenue, but
             upon a limited class in return for a special benefit. These
             assessments, it has been suggested, proceed upon the
             theory that when a local improvement enhances the value
             of neighboring property, it is reasonable and competent for
             the Legislature to provide that such property shall pay for
             the improvement.”

Id. at 309, 176 S.E.2d at 23 (quoting Tarboro v. Forbes, 185 N.C. 59, 61, 116 S.E. 81,

82 (1923); see also Kenilworth v. Hyder, 197 N.C. 85, 90, 147 S.E. 736, 738 (1929)

(“Provisions relating to taxation generally are uniformly held not applicable to local

assessments or special taxation for improvements.”).



                                            23
                            BOLES V. TOWN OF OAK ISLAND

                   COLLINS, J. concurring in part and dissenting in part



      Here, the Session Law creates a fee-supported sewer district for Oak Island.

The Fees are specifically allocated to pay down the debt on Oak Island’s sewer system,

which provides a purely local improvement to the residents of Oak Island and helps

a limited class of citizens by providing them with benefits different from those of the

general public. Because those living in Oak Island receive a special, distinct benefit

in exchange for paying the Fees, the Fees are not being collected for general revenue

purposes. Accordingly, the Fees are not taxes in the meaning of the North Carolina

Constitution.

      Because the Fees are not taxes, Plaintiffs’ tax-based arguments also fail.

                                      Conclusion

      I conclude there is no merit to Plaintiffs’ arguments that the Fees are

unauthorized by statute, unconstitutional, and violative of certain tax principles. As

I conclude there is no genuine issue as to any material fact and Oak Island is entitled

to judgment as a matter of law, I would affirm the trial court’s order granting

summary judgment in favor of Oak Island.




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