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Alfred Vail Mutual Association v. Speaker of House

Decided: December 2, 1969.

ALFRED VAIL MUTUAL ASSOCIATION AND THE TOWNSHIP OF SHREWSBURY, PLAINTIFFS-APPELLANTS,
v.
SPEAKER OF HOUSE, ROBERT HALPIN; PRESIDENT OF SENATE, SIDO RIDOLFI; BOROUGH OF NEW SHREWSBURY; MAYOR, JACK LEMON; TINTON FALLS REGIONAL ELEMENTARY SCHOOL BOARD OF EDUCATION; AND JOHN THOMPSON, PRESIDENT, DEFENDANTS-RESPONDENTS



Conford, Collester and Kolovsky. The opinion of the court was delivered by Conford, P.J.A.D.

Conford

Plaintiffs attack the validity of the apportionment of expenses for regional school costs as between the Township of Shrewsbury and the Borough of New Shrewsbury, resulting from the adoption of L. 1965, c. 175 (N.J.S.A. 18:8-17.2).*fn1

The cited statute is attacked as unconstitutional and its effect impugned as invalid on various grounds. The gravamen of the grievance asserted is that whereas previously the named municipalities shared costs of annual or special appropriations of the regional school district, which they constitute together, on the basis of the respective proportions of assessed valuations for taxation, the 1965 enactment changed that basis to the proportions of children enrolled in the schools.

The Law Division held against plaintiffs, and they appeal.

Shrewsbury and New Shrewsbury comprise a regional elementary school district denominated Tinton Falls Regional Elementary School District. This district and the Borough of Eatontown School District constitute together a regional high school district called Monmouth Regional High School District. Involved in the litigation is the division of elementary school costs for the Tinton Falls district and for the share of the expenses for the high school district as between Shrewsbury and New Shrewsbury. Eatontown is not affected.

I. Background

An understanding of this controversy requires outlines of the history both of the school districts affected and of the applicable legislation. The former is largely based upon the contents of a supplemental brief supplied by defendants insofar as not controverted by plaintiffs.

A. As to the Governmental Entities

Prior to 1950 the Township of Shrewsbury comprised both of what now are known as the Township of Shrewsbury and the Borough of New Shrewsbury. Pursuant to L. 1950, c. 133, and a referendum of the voters in the area designated thereby, the Borough of New Shrewsbury (New Shrewsbury, hereinafter) was carved out of the former township, and the remnant continued as the Township of Shrewsbury (Shrewsbury, hereinafter). New Shrewsbury is substantially the larger in population and area. These municipalities continued, however, as a single school district. Costs of the school district were apportionable to the constituent municipalities on the basis of assessed valuations.

We are told that the population of Shrewsbury after the severance consisted mainly of the residents of a housing development on property of the United States Government built about 1941, known as Alfred Vail Homes, and of another smaller housing development constructed later known as Crawford Street Apartments. The Vail Homes being on tax-exempt property owned by the Federal Government, certain moneys were paid in lieu of taxes by the Government to the Shrewsbury Township School District on a per-pupil basis. The United States sold the Vail Homes in 1957 to plaintiff Alfred Vail Mutual Association, a corporation, and as a result federal school aid was discontinued July 1, 1958. The Crawford Street Apartments were sold to the township. (We are not told who now owns them.) The aggregate assessed valuations of Shrewsbury apparently now consist

solely, or substantially so, of the two housing developments mentioned. New Shrewsbury's assessed valuations consist primarily of individual residences.

In 1957 New Shrewsbury attempted, pursuant to N.J.S.A. 18:5-1.1 et seq. , to split the Shrewsbury Township School District, apparently because of the prospective loss of federal tax aid in relation to the Vail Homes, but failed because of a veto by the statutory board of review based upon the ground that Shrewsbury was too small to maintain a school district.

On November 27, 1957 the voters of the Eatontown and Shrewsbury School Districts passed a referendum authorized by those bodies to create a regional high school district. The terms of the referendum called for apportioning annual costs thereof, as between the two said districts, on a perpupil basis (average daily enrollment). However, as between Shrewsbury and New Shrewsbury, the high school regional costs were to be divided on the basis of assessed valuations.

In 1962 the board of education of the Shrewsbury School District submitted to the voters of the constituent municipalities a referendum to regionalize the district, and this was passed in both municipalities. The purpose was to qualify for larger state aid. The regionalization proposal, as submitted to the voters, called for apportionment of costs on the basis of assessed valuations, the statute affording an option as between that basis and average daily enrollment. N.J.S.A. 18:8-1. As indicated above, the regional district thus created is now denominated Tinton Falls Regional Elementary School District. It clearly appears that the ratio of enrolled pupils to assessed valuations is substantially lower in New Shrewsbury than in Shrewsbury.

B. As to Apportionment Legislation

Prior to 1953 apportionment of the expense of annual or special appropriations in regional school districts among constituent municipalities was solely on the basis of assessed

valuations ("ratables"). R.S. 18:8-17. Under L. 1953, c. 90, R.S. 18:8-1, dealing with the creation of regional school districts, was amended to provide that the constituent boards of education involved should not only initiate the referendum for the establishment of a regional district but also determine whether amounts to be raised for the aforestated purposes should be "apportioned upon the basis of ratables or average daily attendance." Thus the issue presented to the voters at any referendum included both the question of adoption of the regional district and approval of the apportionment method selected by the submitting board of education.

The 1953 act also amended R.S. 18:8-17 to provide that expenses should be apportioned on the following bases: (1) amounts for interest and redemption of bonds -- ratables of the districts; (2) amounts for annual or special appropriations for regional districts created before the adoption of the act -- ratables of the districts; (3) amounts for annual or special appropriations for regional districts created thereafter -- ...


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