1. Review the history, background, and details of the case.
The case was observed in the supreme court of America in 1999. JK Construction appealed to Western Carolina State. JK Construction was an appellant, as it is a property owner Western Carolina Sewer Authority. Moreover, JK Constructions appealed to Western Carolina State on behalf of all other similarly situated companies.
The point of the case is that Western Carolina Sewer Authority asked the JK Construction to pay 11 new account fees. JK Construction Inc. has paid them under protest. As a result, JK Construction Inc. represented a declaratory judgment action to challenge the fee validity. Therefore, the Incorporation appealed to Supreme Court to enjoy Sewer Authority of Western Carolina to impose the fee and force the authority to reimburse each company that had paid the fee.
Priory, the case was observed in circuit court, where the case has been referred to the master-in-equity. It has granted the master authority entrance to a final judgment appealing directly to this court. The master of circuit court granted the Authority’s motion for summary judgment. It was stated that the ruling fee was valid and approved by current law and the state constitution. It was the main reason for JK Construction to appeal. In 1925, the district has created the only legislature authority to be responsible for the special purposes.
The district owns majority of Greenville County and some parts of three surrounding counties. The Authority possesses and operates sewage pumping stations, sewage treatment facilities, and trunk sewer lines. Authority disposes other entities sewage initial collections. As the matter of fact, JK Construction receives the service form the Metropolitan Sewer Districts. It is a special purpose district that is known as sub-district of Authority.
Pre-history of this case reaches 1995, when the Authority Board of Commissioners voted for individual requirements to each client. After the public hearing and recommendation of a consultant each entity or person was required to pay a new account fee if upgrading to a water line or connecting to the sewer system. According to the Authority Board of Commissioners’ decision the fee ranges from $500 to $80,000. The residential users paid smaller fee and large industrial users were supposed to pay the highest price. After the decision was proclaimed, the Authority started to impose the fee.
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The background information of the case lies in 1975, when the authority has relied on property taxes to fund operating, capital, maintaining, and debt service expenses. That year, the fee turned out to be some kind of condition to continue eligibility for federal grants. Moreover, this condition was of great importance to rely on sewer use charges paying all debts and expenses. It is worth noting that since1970s the Authority pays $120 million on general obligation service, debt service, and revenue bonds as well. Admittedly, the revenue of customers has provided near $30 million for capital projects that were not financially supported by bounded indebtedness. According to JK Construction case, the Authority’s clients have paid $27 million of retained earnings and funded a contingent account of $2.5 million. All these funds were paid for sewer use charges.
2. State the main ethical problem or issue present in the case.
There are few major ethical issues presented in the case. The major one is the dilemma if the fee is a tax or a charge. Moreover, did the trial court err in ruling that authority is able to provide a new fee to the sewer system after the given data; if the new account fee was a charge, not a tax, the case must be equally applied to all clients in the particular purpose district. If the trial court errs in imposition a new account fee, it does violate the equal protection clause.
3. List the main possible solutions to the case.
It is hard to agree with the trial court as far as its decision that the required payment is a change, not a tax. Anyway, the Authority has imposed the charge upon clients required to pay. To solve this problem, some issues must be provided. First, the required payments primarily must be paid by those clients who get the benefits or advantages as a result of improvements made on the basis of required fee. Second solution lies on the fact that required fee is preceded mainly to improvement projects. Third, as Authority provided the required payments for users to pay, the trial court has stated that the payment must be fair and justly appointed among those who have to pay.
4. State the important and probable outcomes or consequences of each main solution.
The construction of constitution is the major possible outcome. However, while doing so, the court is able to apply the same rules that relate to construction of statutes. Moreover, it might limit or expand the Authority’s operations. Consequently, the case applies to counties, not particular district. Therefore, some other political subdivisions might be restricted.
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5. Describe the likely impact of each main solution on peoples’ lives.
Obviously, the problem solution would have an impact on companies and individuals’ lives. It goes without saying that the taxes and charges would increase. Moreover, General Assembly proved the right of each governmental entity to provide the sewer facilities to any part or all of maintaining and operating costs. In addition, in recent years the impact of fee increased greatly.
6. Explain the values upheld and those violated by each main solution.
JK Construction Inc. applied to trial court to define what the requirement payments are and how they refer to individuals and personal users. The JKC Inc. insisted that the definition and usage of such payments must be based on rational and legal basis. It must be managed by government and provided by authorities. All clients should have reasonable relation to the taxes and they should be treated under similar circumstances.