For the prosecutor, Leo Rosenblum.
For the defendants, Charles A. Rooney (Charles Hershenstein, of counsel).
Before Justices Case, Bodine and Porter.
The opinion of the court was delivered by
PORTER, J. At a meeting of the defendant Board of Commissioners of the City of Jersey City held on October 3d, 1944, a resolution was adopted setting forth reasons why, in the Board's opinion, the proposed new state constitution would be detrimental to the best interests of the city. It provided for public advertisements in which the Board's views were to be publicized for the purpose of defeating the ratification of the constitution at the November 7th election. The legality of this resolution is before us on certiorari. Its text is as follows:
"WHEREAS, as a result of the decision of the New Jersey Court of Errors and Appeals affirming the decision of the Court of Chancery of New Jersey, declaring unconstitutional the railroad settlement bills which so vitally affect the municipality of Jersey City, in which litigation the city's interest amounted to approximately $20,000,000, and there still remain many millions of dollars unpaid to the City of Jersey City; and
"WHEREAS, there is located in the City of Jersey City a vast amount of railroad property, including valuable waterfront property, and the payment of the just and fair share of taxation on that property seriously affects the finances of the city, and the general well-being and welfare of the people of Jersey City; and
"WHEREAS, the railroads have been urging upon the courts for years that their property should be assessed in accordance with standards of value and not in accordance with 'true value' as assessed by the taxing authorities, but have been unsuccessful in their efforts by reason of the adverse decisions rendered by our courts; and
"WHEREAS, a proposed revised Constitution is to be voted on by the people of this state at the general election to be held in November, 1944, which said proposed Constitution
modifies the existing Constitution so as to enable the railroads to accomplish enormous tax discriminations and preferences which they have been striving to obtain for years, without success, by reason of the present constitutional provision which provides that all property, including railroad property, must be assessed at true value and in no other way; and
"WHEREAS, it is imperative that the people of the entire state, upon whom depends the adoption or rejection of this Constitution, should be apprised of the seriousness of the situation which confronts the people and which so vitally affects the interest and welfare of Jersey City; and
"WHEREAS, the best method of making known to the people of this state the importance of this matter is through paid, wide publicity throughout the state.
"NOW, THEREFORE, BE IT RESOLVED, that the city, through its Mayor, is hereby authorized to publicize and advertise all of the facts relating to this matter and the advantages resulting to Jersey City, from a defeat of the proposed revised Constitution and the importance of the matter to the welfare of its people, and to take all and every means available to make known to the people of New Jersey the dangers lurking in the proposed revised Constitution, and so prevent the loss of millions of dollars in railroad taxes to the City of Jersey City; and
"BE IT FURTHER RESOLVED, that the money to be expended for this publicity and advertising be charged against Account No. 225, wherein appropriation has been made for railroad tax litigation."
This resolution was adopted after the Board had received an opinion by counsel of his views as to the effect the new constitution would have on the affairs of the city. It was his opinion that the proposed constitution, if adopted, would result in at least two specific changes in the basic law. (1) It would permit the legislature to select any separately classified type of property and tax it ad valorem at less than its true value. (2) It would permit the legislature to select such class of property and exempt it outright even though it were devoted to private commercial uses. Counsel further advised
the Board that the effect of the adoption of the proposed constitution would be to destroy the legal basis for attack then pending in this court against legislation fixing the railroad tax rate by the Railroad Tax Law of 1941 (Pamph. L., ch. 291), as amended in 1942 (chapter 169).
A large part of the revenue of the City is derived from taxes on railroad property, and it appears that the Board of Commissioners were fearful that if the proposed constitution were adopted, it would very seriously decrease the amount of taxes which the city would receive and that the adoption of the constitution would therefore be inimical to the best interest of the city and against the public good. The publication of newspaper advertisements setting forth its views and arguments against the adoption of the constitution followed. Expenditures of about $30,000 for that purpose were incurred.
Two meritorious questions are presented; first, whether it was lawful for the Board to expend public funds in presenting its views to the public by newspaper advertisements in advocating the defeat of the proposal by the voters; and second, if so, whether funds had been ...