CONSTITUTION OF THE STATE OF GEORGIA

ARTICLE IX. COUNTIES AND MUNICIPAL CORPORATIONS

Paragraph II. Revenue bonds; special limitations.

Where revenue bonds are issued by any county, municipality, or other political subdivision of this state in order to buy, construct, extend, operate, or maintain gas or electric generating or distribution systems and necessary appurtenances thereof and the gas or electric generating or distribution system extends beyond the limits of the county in which the municipality or other political subdivision is located, then its services rendered and property located outside said county shall be subject to taxation and regulation in the same manner as are privately owned and operated utilities.

1976 Constitution.

- Art. IX, Sec. VIII, Para. I.

JUDICIAL DECISIONS

Legislature can regulate utilities.

- Neither alone, nor construed in conjunction with Ga. Const. 1976, Art. III, Sec. VIII, Para. IX (see Ga. Const. 1983, Art. III, Sec. VI, Para. V), does this provision prohibit the General Assembly from regulating municipally owned or operated electric utilities. City of Calhoun v. North Ga. Elec. Membership Corp., 233 Ga. 759, 213 S.E.2d 596 (1975) (see Ga. Const. 1983, Art. IX, Sec. VI, Para. II).

Applicability where revenue bonds issued prior to ratification of 1983 Constitution.

- This Paragraph applied to a municipality's ownership interests in power plants and other facilities that were located outside of the surrounding county, even though the revenue bonds used to purchase the facilities were issued before the ratification of the 1983 Constitution. Collins v. City of Dalton ex rel. Bd. of Water, Light & Sinking Fund Comm'rs, 261 Ga. 584, 408 S.E.2d 106 (1991) (see Ga. Const. 1983, Art. IX, Sec. VI, Para. II).

Disproportionate rates between resident and nonresident water users constitutional.

- Where the city has the right under its charter to furnish water to resident and nonresident users, and to classify rates for such service, an ordinance, increasing rates and fixing rates for nonresident users higher than for resident users, is not violative of the due process and equal protection clauses of the federal and state Constitutions. Messenheimer v. Windt, 211 Ga. 575, 87 S.E.2d 402 (1955).

Nonresident users of city supplied water without standing.

- Nonresident users of water supplied by a city are not in a position to challenge the validity of amendments to the charter of the city and an amendment to the Constitution of Georgia, authorizing the city to appropriate its surplus water funds to the support of its municipal hospital. Messenheimer v. Windt, 211 Ga. 575, 87 S.E.2d 402 (1955).

Procedure to extend existing system of municipal improvements.

- Under the Revenue Bond Law, Ga. L. 1937, p. 761 (see now O.C.G.A. Art. 3, Ch. 82, T. 36), and the constitutional sanction of this paragraph, revenue anticipation certificates may be issued by a municipality to extend an existing system of municipal improvements by pledging the entire revenue of the whole system to the payment thereof, subject to rights of holders of prior issues, without prorating the values of the existing and the new facilities and pledging only the revenue of such new facilities according to their proportion to the total value. Carter v. State, 93 Ga. App. 12, 90 S.E.2d 672 (1955) (see Ga. Const. 1983, Art. IX, Sec. VI, Para. II).

OPINIONS OF THE ATTORNEY GENERAL

Two distinct and separate conditions must exist before utility property owned by a municipality is taxable: first, the municipality must purchase, construct, or operate the gas utility plant from the proceeds of revenue certificates; second, the municipality must extend its services beyond limits of county in which municipality is located; it is immaterial that gas lines outside county may have been constructed from funds other than proceeds of the revenue certificates provided the gas utility plant was constructed with proceeds from such certificates. 1971 Op. Att'y Gen. No. 71-46.

Art. 2, Ch. 4, T. 46. - Since Ga. L. 1956, p. 104 (see now O.C.G.A. Art. 2, Ch. 4, T. 46) requires gas utilities to obtain certificates of public convenience and necessity, and since this paragraph classifies publicly owned systems in foreign counties for regulatory purposes as privately owned and operated utilities, it follows that such publicly owned gas systems are subject to Ga. L. 1956, p. 104 with respect to all extensions beyond the limits of their home county and which are financed by revenue certificates. 1954-56 Op. Att'y Gen. p. 500 (see Ga. Const. 1983, Art. IX, Sec. VI, Para. II).

If a city is located within a county, its gas facility located in the county is not subject to ad valorem taxation by the county. 1970 Op. Att'y Gen. No. 70-191.

Jurisdiction of Public Service Commission.

- The Public Service Commission maintains its jurisdiction over the services and property of that portion of a municipally-owned, revenue bond-financed natural gas distribution system which has been extended beyond the boundaries of the county in which the municipality is located even if the revenue bonds have been paid off by the municipality. 1985 Op. Att'y Gen. No. 85-39.

The Public Service Commission has no jurisdiction over the services and property of a natural gas distribution system owned and operated by and within a municipality. 1985 Op. Att'y Gen. No. 85-39.

The Public Service Commission has no jurisdiction over master-metered customers so long as the activities of said customers do not constitute furnishing service to the public. 1985 Op. Att'y Gen. No. 85-39.