The following was posted in part at misc.legal.moderated. I am posting the URL for it here becuase it is tax-related, i.e., the meaning of "the aggregate tax valuation of property".
The Guam Legislature authorized the Governor to issue bonds
> to fund the Territory's continuing obligations, but Guam's
> attorney general refused to sign the necessary contracts,
> concluding that issuance would violate the debt-limitation
> provision of Guam's Organic Act, which limits the Territory's
> public indebtedness to 10% of the 'aggregate tax valuation
> of the property in Guam,' 48 U. S. C. sec. 1423a. The Governor
> sought a declaration from the Guam Supreme Court that issuance
> would not violate the provision, calculating the debt limitation
> based on the appraised value of property in Guam. Agreeing,
> the Supreme Court rejected the attorney general's argument
> to base the limitation on assessed value. The Ninth Circuit
> granted the attorney general's certiorari petition, but
> while the appeal was pending, Congress removed the Circuit's
> jurisdiction over appeals from Guam. Relying on its holding
> in Santos v. Guam, that Congress had stripped it of jurisdiction
> over pending appeals, the court dismissed the appeal. The
> attorney general then filed a petition for certiorari in
> this Court, even though it was more than 90 days after
> the Guam Supreme Court's judgment.
Johnny and the Supremes agreed unanimously that the appeal to them was timely and they that they had jurisdiction. But they split 5-4 on the meaning of "tax valuation".
Justices Roberts, Breyer, Kennedy, Scalia, and Thomas decided it meant "property at tax assessed value". While Justices Alito, Ginsberg, Souter, and Stevens thought it meant "property at fair market value".
Guam is in a serious financial situation - they don't have the funds to meet their obligations and something needs to be done about this.
I have several opinions on this.
- Alicia Limtiaco, Guam's Attorney General, deserves my respect for refusing to disobey the law as she read it.
- The entire Guam government was out to lunch to have wasted the time and money to take this to court because there were easier ways to resolve this problem as in raise the assessments and decrease the tax rate so that taxpayers' obligations remained constant.
- Issuing bonds to pay current expenses was never sound fiscal policy. In this case, it could have been a short-term fix while the legislature raised taxes or created fees on issues that were the major causes of their excess costs.
Take the time to read the Opinion by Thomas and the Dissent by Souter. They read to me like two sides of a Fiscal coin.
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