The opinion of the court was delivered by: Kollar-kotelly, District Judge.
This case arises out of a dispute about the propriety of a taxation
scheme in the District of Columbia enacted in order to finance the
building of a new convention center in the District. Anise Jenkins and
numerous other named plaintiffs who paid the contested sales and use
tax, as well as Planet Vox, Inc., a business incorporated in the
District, bring this suit against the Washington Convention Center
Authority and the District of Columbia seeking return of their money or
damages. Plaintiffs contend that, during certain specified months, the
Mayor of the District of Columbia collected the tax pursuant to an
expired tax law, thereby engaging in an ultra vires act, depriving them
of property without due process, taking their private property for public
use without just compensation, and effecting a conversion. Pending before
this Court are the Defendants' Motions to Dismiss and for Judgment on the
Pleadings. For the reasons set forth below, the Court concludes that it
lacks subject matter jurisdiction to hear Plaintiffs' claim, and
therefore grants the Defendants' Motion to Dismiss.
In the weeks preceding this deadline, and in the months that followed
it, the District sought and passed emergency legislation in order to
delay the deadline for WCCA's submission of its financial report.*fn1
The District Control Board passed two emergency acts in all; finally, in
June 1998, it enacted new legislation repealing the provision of the 1994
Act that called for the expiration of taxing authority. Plaintiffs,
challenge several aspects of this legislation, including the legitimacy
of the Second Emergency Act and the effective date of the repeal.
Plaintiffs have asserted two claims against Defendants under District
law. See Compl. ¶¶ 72, 75. Plaintiffs first allege that Defendants'
collection of Plaintiffs' money under claim of entitlement pursuant to
the 1994 Act was ultra vires — that the Mayor and his subordinates
had no power to collect taxes without legislative authority. See Compl.
¶ 72. Plaintiffs also suggest that the taking of the tax moneys for
the convention center amounted to conversion under District law. Compl.
Plaintiffs raise two related claims under 42 U.S.C. § 1983. See
Compl. ¶¶ 73-74. First, Plaintiffs contend that the taking of their
money under this taxation scheme by District officials in the absence of
proper legislative authority violated their constitutional rights by
depriving them of property without the legislative process to which they
were due. Compl. ¶ 73. In addition, Plaintiffs suggest that
Defendants are liable to them under 42 U.S.C. § 1983 for taking their
property without just compensation in violation of the takings clause of
the Fifth Amendment. Compl. ¶ 74.
Defendant WCCA moved to dismiss the complaint pursuant to Fed.R.Civ.P.
12(b)(1) and 12(b)(2), and for judgment on the record pursuant to
Fed.R.Civ.P. 12(c); Defendant District of Columbia joined in these
motions. See Defendants' Joint Reply in Further Support of Their Motions
to Dismiss and for Judgment on the Pleadings. The Defendants predicate
their Motion to Dismiss, in relevant part, on the Federal Tax Injunction
Act, 28 U.S.C. § 1341 ("FTIA"), as well as on a similar provision of
the District of Columbia Code, the District of Columbia Tax Injunction
Act, D.C.Code § 47-3307 ("DCTIA").
In deciding whether subject matter jurisdiction exists in the instant
case, the Court looks first to the scope and application of the Federal
Tax Injunction Act, a statute that aims to insulate state tax
administration from unwarranted federal intervention. This 1937 statute
that "[t]he district courts shall not enjoin, suspend or restrain the
assessment, levy or collection of any tax under State law where a plain,
speedy and efficient remedy may be had in the courts of such State."
28 U.S.C. § 1341. Congress fashioned the FTIA to codify common law
principles of comity and federalism in the domain of taxation. See Fair
Assessment in Real Estate Ass'n, Inc., v. McNary, 454 U.S. 100, 102, 102
S.Ct. 177, 70 L.Ed.2d 271 (1981). In McNary, a taxpayers' association
challenged the property tax assessment practices in St. Louis County,
Missouri. See id. at 105-106, 102 S.Ct. 177. The Supreme Court commented
upon the serious effects posed by federal court intervention into disputes
over state taxes, noting that "[i]t is upon taxation that the several
States chiefly rely to obtain the means to carry on their respective
governments, and it is of the utmost importance to all of them that the
modes adopted to enforce the taxes levied should be interfered with as
little as possible." Id., citing Dows v. City of Chicago, 11 Wall. 108,
78 U.S. 108, 20 L.Ed. 65 (1870). Since nothing in the FTIA or its
judicial construction directly addresses the application of the Act to
the District of Columbia, the Court must decide if this Act or its
District of Columbia counterpart (the District of Columbia Tax Injunction
Act) precludes federal jurisdiction on the substance of Plaintiffs'
claims against the District.
A. Does the Federal Tax Injunction Act apply to the District of Columbia?
1. The District as a local sovereign
The threshold question before the Court in this regard is whether or
not the District of Columbia falls within the purview of the category
"State" as it operates in the FTIA. Although no settled law exists on
precisely this question, cases addressing legislation with a similar ambit
suggest that the FTIA does apply to the District. The Supreme Court has
held that whether the District "constitutes a `State or Territory' within
the meaning of any particular statutory or constitutional provision
depends upon the character and aim of the specific provision involved."
District of Columbia v. Carter, 409 U.S. 418, 420, 93 S.Ct. 602, 34
L.Ed.2d 613 (1973), reh'g denied, 410 U.S. 959, 93 S.Ct. 1411, 35 L.Ed.2d
694 (1973). In Carter, the Court evaluated the status of the District
under 42 U.S.C. § 1983; it enumerated several factors to consider in
determining whether the District is a state or territory for the purposes
of a statutory provision, including "the words themselves . . . the
context, the purposes of the law, and the circumstances under which the
words were employed." Id. at 420, 93 S.Ct. 602, citing Puerto Rico v.
Shell Co. (P.R.), Ltd., 302 U.S. 253, 258, 58 S.Ct. 167, 82 L.Ed. 235
(1937). As an illustration of this analysis, the Court pointed to the
fair housing standards of 42 U.S.C. § 1982, observing that "it would
be anomalous indeed if Congress chose to carve out the District of
Columbia as the sole exception to an act of otherwise universal
application." Id. Indeed, the Court continued, "this is all the more true
where, as here, the legislative purposes underlying [the law] support its
applicability in the District." Id.
In addition, courts have generally indicated that the District of
Columbia resembles a state within the framework of a comity analysis. See
Silverman v. Barry, 727 F.2d 1121, 1123, n. 4 (D.C.Cir. 1984) (assuming,
"as this court has on other occasions that the abstention rules apply in
the District with the same force as they do where a state sovereign is
involved."). Cf. Shook v. District of Columbia Fin. Responsibility &
Management Assistance Auth., 132 F.3d 775, 776 (D.C.Cir. 1998) (comparing
the District Charter created under the Home Rule Act "in certain respects
to a state constitution."). Congress itself drew an explicit parallel
between the jurisdictional balance of federal and local courts in the
District of ...