On appeal from the Appellate Division of the Superior Court.
For affirmance -- Chief Justice Vanderbilt, and Justices Heher, Oliphant, Wachenfeld, Jacobs and Brennan. For reversal -- Justice Burling. The opinion of the court was delivered by Heher, J. Burling, J. (dissenting).
The questions here are: (a) whether the defendant authority's mode of exercise of the statutory power to levy charges for sewerage service accords with the grant, and if so (b) whether the action so taken constitutes a denial of the equal protection of the laws secured by the Fourteenth Amendment to the Federal Constitution.
These inquiries were resolved in favor of the authority by the Law Division and the Appellate Division of the Superior Court. 28 N.J. Super. 586 (App. Div. 1953). The constitutional question sustains plaintiffs' appeal as of right. 1947 Constitution, Article VI, Section V, paragraph 1(a).
The authority is a "public body politic and corporate" created by an ordinance adopted August 28, 1950 by the governing body of the Township of Pennsauken according to L. 1946, c. 138, N.J.S. 40:14 A -1 et seq., empowering, section 2, "counties, or municipalities either separately or in combination with other municipalities, by means and through the agency of a sewerage authority, to acquire, construct, maintain, operate or improve works" for the "collection, treatment, purification or disposal of sewage or other wastes," and, "if necessary, works for the impounding, transportation and release of water for the replenishment in periods of drought or at other necessary times of all or a part of waters in or bordering the State diverted into a sewer, sewage treatment or sewage disposal system operated by the sewerage authority," and, section 8(a), "to charge and collect rents, rates, fees or other charges (in this act sometimes referred to as 'service charges') for direct or indirect connection with, or the use or services of, the sewerage system." The authority, N.J.S. 40:14 A -4(a), shall be identified with its creator by the use
in its name of "all or any significant part of the name" of the municipality.
The plaintiff County of Camden, in its governmental capacity, maintains and operates at 2276-43rd Street in the Township of Pennsauken, a local unit of government within the county, an institution known as the Camden County Children's Shelter and School; and the co-plaintiff Board of Education of the Vocational School in the County of Camden, a public body corporate, manages a county vocational school on Browning Road, within the township.
Both "plaintiff institutions," it is stipulated, "are attended by, and occupied by, students and children from various municipalities in the County of Camden, as well as some municipalities from outside of the County of Camden; some of the parents of such children are taxpayers of the County of Camden and a few are not; some of such parents are taxpayers outside of the County of Camden; some of such students and children live in and come from homes in many municipalities in Camden County in addition to the Township of Pennsauken"; both "institutions are supported, operated and maintained by County funds, derived from taxation of all municipalities in" the County of Camden; "in addition the Vocational School receives funds from the State and Federal Government." The stipulation terms all three bodies "municipal corporations," these two and the defendant sewerage authority.
Prior to the organization of the authority, the local sewerage plant was maintained and operated directly by the township itself. A charge for sewer service was first made in 1927, at the "annual unit rate of $2.08"; this levy remained in effect until 1935, when the annual unit rate was increased to $3, and such was the rate until April 5, 1951, when the defendant authority, by resolution, adopted a schedule of sewerage charges which fixed a minimum annual charge of $10 for a prescribed "standard living unit," and a like minimum annual charge "for all commercial and industrial businesses and establishments," "for each water closet or its equivalent." On February 19, 1952 the authority amended
the resolution to provide for a "sewer service charge or sewer rental charge for all buildings, dwellings, construction and property of whatsoever kind and type, except the Pennsauken Township public schools, the fire houses and buildings used and occupied by the fire companies in" the Township, "and any and all buildings, construction and property owned and/or operated" by the Township, "which are now directly or indirectly connected with or which may in the future be connected with said comprehensive sewerage system." And on March 17, 1953, after the commencement of this action, there was a further amendment of the regulation prescribing a charge of $10 for a sewer-connection permit, but making no change in the provisions apposite here.
Apart from the question of the scope of the statutory grant, this exemption of the enumerated township facilities from the incidence of the sewer-service charge is assailed as "unjustly discriminatory against plaintiffs"; and judgment is sought voiding the concession thus accorded the township facilities as "illegal and void," or, in the alternative, that a like exemption "be granted to all public buildings" in the township, including those of plaintiffs.
Before the authority came into being, there were no sewerservice charges "levied against or collected" from any of the Pennsauken Township public schools, nor from any of the township "owned and/or operated property," nor from any of the township "Fire Companies," except the "North Merchantville Fire Company, which for a few years prior to the creation of the defendant had been charged $3 per unit per year for use of sewerage facilities."
Previous to April 5, 1951 the County of Camden "had paid sewer service charges" for the use of the township's sewerage facilities; "since 1925, and for several years prior to" that day, the county "had been paying $30 per year" for the service, "at the rate of $3 per unit, based on ten units"; and for approximately 20 years before, the vocational school board had paid for the use of the facilities, "for several years"
$150 per annum, "at the rate of $3 per unit, based on fifty units."
Thus, under the resolution of April 5, 1951 the annual sewer charge levied against the county for the shelter and school was increased to $100, and against the vocational school board, to $500. The county has not paid the sewer charges laid against it for 1951 and 1952; the school board paid but one-half of the charge for 1951, and there was no payment on the charge for 1952.
The ordinance creating the defendant authority declares it to be "an agency and instrumentality" of the township "for the purposes of the relief of the waters in and bordering the State from pollution arising from causes within" the township, "and the consequent improvement of conditions affecting the public health." To effectuate the purpose, the township forthwith granted and conveyed to the authority its right, title and interest in the "sewer lines and the sewer pumping station" in the township, and "its one-half interest in the sewage treatment plant" therein, situate on Browning Road, and also conveyed to the authority vacant land in excess of 14 acres for use in the construction of a new sewage treatment plant, all of the value of $2,500,000; and the authority was enjoined to "finance its share of the cost of operating ...